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UPDATE: D.A. Davidson Downgrades Sterling Financial Following Announcement of Acquisition by Umpqua

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In a report published Friday, D.A. Davidson analyst Jeff Rulis downgraded the rating on Sterling Financial Corporation (NASDAQ: STSA) from Buy to Neutral, but raised the price target from $30.00 to $30.52.

In the report, D.A. Davidson noted, “Sterling shareholders will receive 1.671 shares of Umpqua Holdings Corporation (UMPQ – BUY - $16.44) common stock and $2.18 cash for each share of Sterling common stock. This represents a 15% premium to yesterday's (9/11/2013) closing price and is, in our opinion, a fair value (~1.65x current TBV). The offer is approximately 2.5x Sterling's 2010 recapitalization price and the merger would close the chapter on a successful transition from a struggling bank to one with a good franchise value that has attracted an impressive suitor. Existing shareholders of Umpqua and Sterling are expected to own approximately 51% and 49% of the outstanding shares, respectively.”

Sterling Financial Corporation closed on Thursday at $28.40.

Latest Ratings for STSA

DateFirmActionFromTo
Oct 2013UpgradesNeutralBuy
Oct 2013DowngradesOutperformMarket Perform
Sep 2013DowngradesBuyHold

View More Analyst Ratings for STSA
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Posted-In: D.A. Davidson Jeff RulisAnalyst Color Downgrades Analyst Ratings

 

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