Jefferies Downgrades Boston Private Financial (BPFH) to Hold
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Jefferies downgraded Boston Private Financial (NASDAQ: BPFH) from Buy to Hold with a price target of $14.00 (from $15.00) to reflect post-election stock/EPS dynamics.
Analyst Ken Usdin commented, "We move to the sidelines as BPFH has widened its P/E premium to peers on a P/E basis (now a 2.6x premium vs. 1.8x on Nov. 8). We see limited additional upside given a bottom decile asset-sensitivity profile and lack of meaningful exposure to any potential infrastructure spending bill. BPFH's asset-sensitivity is limited by its high loan/deposit ratio, low percentage of earning assets repricing within one year and lower mix of noninterest-bearing deposits relative to earning assets. Furthermore, in the last rate cycle, BPFH had an above-average deposit beta relative to peers, which could keep NIM benefits from rate hikes contained again this cycle. Our price target of $14 implies 17.5x our '18 EPS estimate, or 105% of the current '17 S&P 500 P/E multiple. Upside risks to our downgrade: return to stronger inflows and faster overall wealth management growth, stronger than expected loan growth, longer-than-expected life of credit recoveries."
Shares of Boston Private Financial closed at $15.55 yesterday.
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Related EntitiesJefferies & Co, Standard & Poor's
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