UPDATE: Bank of America Downgrades Fifth Third Bank to Neutral on Valuation
Bank of America reduced its rating on Fifth Third Bank (NASDAQ: FITB) from Buy to Neutral with a reiterated $16.50 price objective.
Bank of America commented, "We see few near term catalysts and believe that valuations reflect the approx. $1bn in after-tax gains that FITB can potentially realize from the sale of its remaining stake in Vantiv and subsequently deploy this toward buying back shares. … While earnings should benefit from a longer mortgage banking tailwind (~12% of revenues), we see better potential for upward EPS revision at WFC given higher exposure to mortgage banking. Meanwhile, we see both stronger potential for upward EPS revision (on better '13 margins) and multiple expansion at PNC (9.6x ‘13E, 1.2x TBV)."
Fifth Third Bank closed at $15.86 on Tuesday.
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