This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

First Niagara: Branch Sale Winner

Interested in more on First Niagara Financial Group? See TheStreet Ratings' report card for this stock.

Thursday's loser among large-cap U.S. banks was Regions Financial (RF - Get Report), with shares declining over 2% to close at $4.69.

The Birmingham, Ala., lender announced late Wednesday that it had agreed to sell Morgan Keegan to Raymond James Financial (RJF - Get Report) for $930 million. Regions had been peddling its mortgage subsidiary since June, initially seeking a price of about $1 billion. Before the sale is completed, Raymond James will upstream a $250 million dividend to Regions.

Regions also announced it would take a fourth-quarter goodwill impairment charge ranging between $575 million and $745 million, and said it expected to report a fourth-quarter net loss to common shareholders "in a range of $432 million to $633 million or $(0.34) per common share to $(0.50) per common share," but that "net income from Continuing Operations without the goodwill impairment charge (non-GAAP) is expected to be in a range of $88 million to $119 million or $0.07 to $0.09 per common share."

Regions owes $3.5 billion in federal bailout funds received through the Troubled Assets Relief Program, or TARP.

FBR analyst Scott Valentin on Thursday reiterated his "Market Perform" rating for Regions, and said that "while the $1.18 billion valuation is slightly above our expectations, the net benefit to capital ratios was less than expected," and that through the Morgan Keegan sale, Regions Financial's "Pro forma 3Q11 Tier-1 common equity ratio increases 9 bps, to 8.25%, and Tier-1 capital risked-based ratio increases 13 bps, to 12.97%."

Deutsche Bank analyst Matt O'Connor said that the sale of Morgan Keegan "continues to build the credibility of Regions Financial's management and we view it as another meaningful step in the right direction." O'Connor added that Regions can now focus on "fundamentals - with the key being improvement in credit quality."

O'Connor reiterated his "Buy" rating for Regions, with a price target of $5.00, saying that "While RF shares have rallied sharply (up 26% in the last 3 weeks or so)," the shares still had upside "given an attractive valuation, good underlying earnings power and a lot of franchise value."

2 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
FNFG $8.84 -1.23%
RF $9.45 1.18%
RJF $56.78 -1.15%
AAPL $124.43 -1.54%
FB $82.22 -1.18%

Markets

DOW 17,776.12 -200.19 -1.11%
S&P 500 2,067.89 -18.35 -0.88%
NASDAQ 4,900.8850 -46.5560 -0.94%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs