Credit Suisse Starts Prudential Financial (PRU) at Neutral
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Credit Suisse initiates coverage on Prudential Financial (NYSE: PRU) with a Neutral rating and a price target of $89.00.
Analyst John Nadel commented, "PRU’s operating performance has been solid over the past few years, and we think the company has several advantages over peers, including a more attractive business mix and higher relative ROE. However, despite a relatively attractive valuation at less than 8.5x our 2017E EPS of $10.05 and ~110% of 2Q16 book value per share (excluding AOCI and Fx Remeasurement), we see few catalysts on the horizon, and we wouldn’t expect PRU’s 2017 Outlook to result in positive EPS revisions. Additionally, PRU looks to be in a less advantageous regulatory position with MET recently winning its District Court case against the Fed and having its SIFI designation rescinded (while LNC and VOYA are not designated non-bank SIFI). While there have been several positive developments of late, including freed up capital from the VA captive recapture and related increase to 2016 buyback authorization, we see headwinds to EPS and ROE over the next few years."
Shares of Prudential Financial closed at $85.01 yesterday.
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