UPDATE: Sterne Agee Reiterates Neutral Rating, Raises PT on SunTrust Banks

In a report published Monday, Sterne Agee reiterated its Neutral rating on SunTrust Banks

, and raised its price target from $28.00 to $31.00. Sterne Agee noted, “Core fundamentals beat expectations as positive operating leverage, lower mortgage repurchase demands/costs, and signs of life in C&I demand were each encouraging. However, normalizing credit metrics, NIM/spread pressure, and potential moderation of mortgage revenues will likely pressure EPS growth in '13. Although the shares of STI are not expensive, diminishing earnings leverage will likely keep a lid on the multiple for the time being. Neutral.” SunTrust Banks closed on Friday at $29.35.