Usdin said that "questions on capital remain" for Zions, as the company estimated a Basel III Tier 1 common equity ratio of 7.8%, and the analyst said that depending on how federal regulators' new rules on calculating risk-weighted assets are finalized, the company's CDO swap could cause its risk-weighted assets to increase by $4 billion, "causing the pro forma Basel III Tier 1 common ratio [to] be about 60bp lower, or around 7.2%."
The analyst said "Our $21 price target (from $22) applies a 12x multiple to our '13 EPS estimate of $1.75. This is lower than the historical multiple of 14x ('00-'07) to account for lower post-cycle growth and lower return on equity (ROE)."
Interested in more on Zions Bancorporation? See TheStreet Ratings' report card for this stock.
Email. Follow @PhilipvanDoorn
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