Huntington Bancshares (HBAN) - Get Report was downgraded to equalweight from overweight Thursday by a Stephens analyst who also raised his price target on shares of the financial services company to $14 from $12.
Shares of the Columbus, Ohio-based Huntington were falling 2.67% to $12.04.
While McEvoy said he sees the TCF acquisition as positive from a strategic perspective and believes Huntington is positioned to generate "some of the best industry profitability metrics" once cost savings are fully realized, this won't be until late 2021 and 2022.
Given this time frame, the analyst said he expects Huntington shares to be "more of a peer performer" in the first half of 2021.
Separately, Keefe Bruyette analyst Christopher McGratty downgraded TCF Financial to market perform from outperform with a price target of $39, up from $38.
McGratty said he was aligning TCF's rating with Huntington's rating and he expects the merger to close in the second quarter of 2021.
Detroit-based TCF Financial was down 2% to $36.19.
Huntington operates a network with 839 branches across seven Midwest states. TCF Financial has a 475-branch network in states including Michigan, Illinois and Minnesota.
Deals among financial services companies are increasing as U.S. regional lenders seek to bulk up to compete with giants such as JPMorgan Chase (JPM) - Get Report and Bank of America (BAC) - Get Report, which are moving into new states and spending billions annually on digital offerings.