Updated with comments from Credit Suisse about PNC's expected compliance with Basel III capital requirements, in mid-2014.
"At 12x 2013 earnings" estimates, Usdin said that current price "valuation seems pretty fair" for most of the banks covered by Jefferies, and said "the group will likely need even-better loan growth" than analysts expect, "to power through from here."
Of course, some of the best-known banking names outside of Usdin's coverage universe are trading at much lower multiples to forward earnings:
- Shares of Bank of America (BAC) closed at $9.57 Friday, returning 72% year-to-date, following a 58% plunge during 2011. The shares trade for just eight times the consensus 2013 EPS estimate of $1.20, among analysts polled by Thomson Reuters. Bank of America is also trading at a heavily discounted 0.8 times tangible book value, according to HighlineFI.
- Citigroup (C) closed at $36.55 Friday, returning 39% year-to-date, following last year's 44% drop. Citi trades trades for eight times the consensus 2013 EPS estimate of $4.78. The shares are also discounted to 0.7 times tangible book value.
- JPMorgan Chase closed at $45.98 Friday, returning 39% year-to-date, following a 20% decline during 2011. While JPMorgan is generally considered a safer play than BAC or Citi, with the shares trading for 1.5 times tangible book value, the shares still appear cheap to forward earnings, trading for eight times the consensus 2013 EPS estimate of $5.52.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV