Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.
Comerica Incorporated (NYSE:CMA) reported first-quarter EPS of $2.11 Tuesday, beating the consensus estimate of $1.93.
The quarter was noisy; the earnings beat came on the back of a negative provision; and the forward estimates have been revised lower, according to Raymond James.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
The Analyst
Raymond James’ Michael Rose downgraded Comerica from Strong Buy to Outperform and reduced the price target from $92 to $87.
The Thesis
Excluding a tax benefit from employee stock transactions and the repositioning of a portion of its securities portfolio, the core EPS stands at $2.08, Rose said in a Wednesday note. (See his track record here.)
Although this figure is also higher than the consensus estimate, it was boosted by a negative loan loss provision, lower-than-expected non-interest expenses and modestly higher-than-forecast net interest income, the analyst said. Core fee income was essentially in-line, he said.
The difference between the loan loss provision forecast of $16 million and the reported negative provision of $13 million equates to around 14 cents in EPS, Rose said.
FREE REPORT: How To Learn Options Trading Fast
In this special report, you will learn the four best strategies for trading options, how to stay safe as a complete beginner, a 411% trade case study, PLUS how to access two new potential winning options trades starting today.Claim Your Free Report Here.
During the quarter, Comerica repositioned lower-yielding treasury securities of $1 billion, which resulted in a pre-tax loss of $8 million, according to Raymond James. During the earnings call, the company said this will improve interest income by around $1 million per quarter moving forward.
Period-end deposit growth had a $1.2-billion negative impact from the timing of monthly federal benefit activity in the company’s government prepaid card business, Rose said.
Comerica expects its net interest income to be flat to slightly better sequentially during the rest of 2019. While the company said some capex from its customers could drive loan growth, it added that they were drawing down on deposits, which will impact loan growth.
Raymond James lowered the EPS estimates for 2019 and 2020 from $8.20 to $8.10 and from $8.55 to $8.35, respectively, to reflect lower net interest income.
Price Action
Comerica shares were down 0.26 percent at $79.18 at the time of publication Wednesday.
Related Links:
Benzinga's Top Upgrades, Downgrades For April 17, 2019
Photo by Dustin Blitchok.
Crypto Whales Are Loading Up — Are You?
New research shows the biggest crypto buyers are back. And this time? They could hold for the possibility that Bitcoin will surpass $100,000 in 2024. You don’t want to miss the next massive crypto bull run like we saw in 2020 and 2021. To know exactly what’s going on and what to buy… Get Access To Benzinga’s Best Crypto Research and Investments For Only $1.