This means that when Fed policy changes and interest rates go up, the banking sector may weather the expected stock market storm much better than other sectors.

Looking at regional banks, Alexopoulos identified three names that appear "cheap on long term earnings," even if their valuations relative to 2014 EPS estimates aren't necessarily attractive. The analyst sorted the list of small-cap and mid-cap banks covered by his firm "on P/E based on long-term earnings (which we peg as 2017 when we see Fed Funds reaching a more normal 4.25% by YE17)." Here are the three names that are cheapest using this approach:

Comerica

Comerica ( CMA) of Dallas has seen its stock rise 50% this year through Monday's close at $44.93. The shares trade for 15.2 times the consensus 2014 earnings estimate of $2.95 a share, among analysts polled by Thomson Reuters. That's a rather high forward price-to-earnings ratio in the current environment.

For the 12-month period ended Sept. 30, Comerica's return on average assets (ROA) was 0.87% and its return on average tangible common equity (ROTCE) was 8.77%, according to Thomson Reuters Bank Insight.

Putting those figures in context, Wells Fargo's ( WFC) stock closed at $42.75 Monday and traded for 10.7 times the consensus 2014 EPS estimate of $4.01. Despite trading at a much lower valuation to the consensus 2013 EPS estimate than Comerica, Wells Fargo has been a much better performer, with a 12-month ROA of 1.53% and ROTCE of 17.58% though Sept. 30.

But Comerica's shares appear attractively priced when Alexopoulos takes his earnings estimates out several years. The shares trade for 7.2 times his 2017 EPS estimate of $6.21.

Comerica is a play on a rising interest rate environment. "At CMA, the company has 85% of loans being floating rate (largely tied to 30-day LIBOR) and 45% of deposits are noninterest bearing," Alexopoulos wrote. This means that when the Federal Reserve eventually begins to allow short-term rates to rise, Comerica will benefit very quickly as its loans reprice upward.

Alexopoulos rates Comerica "overweight." His December 2014 price target for the shares is $14.00.

Zions Bancorporation

Shares of Zions Bancorporation ( ZION) of Salt Lake City close at $29.21 Monday. The shares have returned 37 % this year and trade for 15.9 times the consensus 2014 EPS of $1.84.

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