Barclays Maintains an 'Underweight' on Regions Financial (RF); 1Q11 EPS Preview - Stable Margin but Lower Fees & Elevated Inflows Expected
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Price: $18.90 -0.53%
Rating Summary:
11 Buy, 23 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
Rating Summary:
11 Buy, 23 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 11 | Down: 18 | New: 17
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Barclays maintains an 'Underweight' on Regions Financial (NYSE: RF), PT $8.
Barclays analyst says, "Asset quality concerns at Regions Financial have recently overshadowed all other trends. Still, in 4Q10, NPA inflows decreased 28% to $1.0 billion from $1.4 billion (worst quarter since 3Q09). While we expect NPA inflows to improve toward the $800 million level, we believe this level is too elevated to allow for meaningful loan loss reserve release. As such we believe it will be challenging for RF to return to profitability near-term. We remain particularly concerned with its Investor Real Estate loan portfolio, which totaled $15.9 billion, or 19% of total loans (32% FL/GA; 46% retail/multi-family) with NPLs and NCOs that remain stubbornly high."
"We expect RF to report 1Q11 EPS of ($0.10) vs. consensus of ($0.10).
Results should include $0.03 in securities gains from a $1.5B MBS sale in January."
For more ratings news on Regions Financial click here and for the rating history of Regions Financial click here.
Shares of Regions Financial closed at $7.33 yesterday.
Barclays analyst says, "Asset quality concerns at Regions Financial have recently overshadowed all other trends. Still, in 4Q10, NPA inflows decreased 28% to $1.0 billion from $1.4 billion (worst quarter since 3Q09). While we expect NPA inflows to improve toward the $800 million level, we believe this level is too elevated to allow for meaningful loan loss reserve release. As such we believe it will be challenging for RF to return to profitability near-term. We remain particularly concerned with its Investor Real Estate loan portfolio, which totaled $15.9 billion, or 19% of total loans (32% FL/GA; 46% retail/multi-family) with NPLs and NCOs that remain stubbornly high."
"We expect RF to report 1Q11 EPS of ($0.10) vs. consensus of ($0.10).
Results should include $0.03 in securities gains from a $1.5B MBS sale in January."
For more ratings news on Regions Financial click here and for the rating history of Regions Financial click here.
Shares of Regions Financial closed at $7.33 yesterday.
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