Jefferies Cuts Price Targets on Associated Banc-Corp (ASBC) Following NII Outlook
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Price: $18.42 --0%
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 9 | Down: 12 | New: 19
Rating Summary:
0 Buy, 0 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 9 | Down: 12 | New: 19
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Jefferies is reaffirming its Buy rating on shares of Associated Banc-Corp (NASDAQ: ASBC), but is cutting its price target from $12 to $11.
The company released its quarterly results inline with expectations, the firm notes that it would have been a miss if management didn't release $26 million in reserves. Jefferies predicts that management will "take a hard look" at their dividend for the fourth quarter due to their recent repayment of TARP.
The firm forecasts that ASBC will be able to increase loans by a few percentage points per quarter, regardless of the macro environment.
An analyst at Jefferies comments, "While the significant reserve releases could boost earnings for the next few quarters, a reduction of securities balances should prevent net interest income from growing in the near term, as the company emphasizes loans in the balance sheet mix. Despite the improvement in mix, margin could still come under pressure in the near-term as asset yields continue to re-price lower. Additionally, the company is still in investment mode, which could generate a higher expense base over the next couple of quarters."
Jefferies is reducing its 2011, 2012, and 2013 EPS estimates from $0.70, $1.05, and $1.20 to $0.67, $0.90, and $1.05.
For more ratings news on Associated Banc-Corp click here and for the rating history of Associated Banc-Corp click here.
Shares of Associated Banc-Corp closed at $10.69 yesterday.
The company released its quarterly results inline with expectations, the firm notes that it would have been a miss if management didn't release $26 million in reserves. Jefferies predicts that management will "take a hard look" at their dividend for the fourth quarter due to their recent repayment of TARP.
The firm forecasts that ASBC will be able to increase loans by a few percentage points per quarter, regardless of the macro environment.
An analyst at Jefferies comments, "While the significant reserve releases could boost earnings for the next few quarters, a reduction of securities balances should prevent net interest income from growing in the near term, as the company emphasizes loans in the balance sheet mix. Despite the improvement in mix, margin could still come under pressure in the near-term as asset yields continue to re-price lower. Additionally, the company is still in investment mode, which could generate a higher expense base over the next couple of quarters."
Jefferies is reducing its 2011, 2012, and 2013 EPS estimates from $0.70, $1.05, and $1.20 to $0.67, $0.90, and $1.05.
For more ratings news on Associated Banc-Corp click here and for the rating history of Associated Banc-Corp click here.
Shares of Associated Banc-Corp closed at $10.69 yesterday.
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