UPDATE: D.A. Davidson & Co. Initiates Coverage on MainSource Financial Group with Buy Rating, $17.50 PT as Growth Initiatives Drive Potential Performance Improvement

In a report published Thursday, D.A. Davidson & Co. analyst Stephen Geyen initiated coverage on

with a Buy rating and $17.50 price target. In the report, D.A. Davidson & Co. noted, “Initiating coverage of MainSource Financial Group with a BUY rating and a fair value estimate of $17.50. Over the past ten years Midwest banks have on average traded at a P/E multiple discount to the SNL Bank peer group due to lower growth prospects and profitability. Based on 2014 estimates, the Midwest mid-cap banks currently trade at a 1.2x P/E multiple discount (13.8x compared to 15.0x for the peer group) and the Midwest small-cap banks trade at a 1.5x P/E multiple discount (12.7x compared to 14.2x for the peer group). Applying the SNL peer group median 2014 P/E multiple of 14.2x we derive our price target.” MainSource Financial Group closed on Wednesday at $15.18.