UPDATE: J.P. Morgan Maintains On First Horizon National
In a report published Friday, J.P. Morgan analyst Steven Alexopolous maintained a Neutral rating on First Horizon National (NYSE: FHN) and maintained a price target of $11.50.
In the report, J,P. Morgan says "We walked away from the investor day not only with a better understanding of the company's roadmap toward achieving an ROTE in the 15-20% range over the long- term but also a better appreciation of the quality of management throughout the organization commissioned with making these “bonefish” targets a reality. While many in the banking industry talk of economic profits and generating returns on capital, FHN stands out as the bank in our coverage universe where the concept is perhaps pushed the deepest. While achievement of these longer-term objectives would place FHN at the top of the pack on a ROTE basis, the company also for the first time provided financial targets in the current low rate environment, which called for a more muted ROTE in the 8-12% range, which is in line with where many peers operate today. While no “new” updates were provided in regards to potential mortgage-related settlements, management indicated it would remain patient as it works with various agencies, which could very well prove to be a more shareholder friendly approach over the longer-term, but over the nearer-term we expect lingering settlement risk to act as an overhang on FHN shares. Consequently, we continue to rate FHN at Neutral."
First Horizon National closed on Thursday at $11.30.
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