Analyst Matthew H. Burnell said Wells Fargo is upgrading the financial services company based on three factors.
"The firms leverage to improving commercial lending activity," the company's "above peer capital returns and recent successful CCAR submission, and the "expectations for higher short-term interest rates and CMA'S above peer asset sensitivity," he said.
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TheStreet Ratings team rates COMERICA INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate COMERICA INC (CMA) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations, solid stock price performance and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The gross profit margin for COMERICA INC is currently very high, coming in at 94.70%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 17.72% is above that of the industry average.
- Net operating cash flow has significantly increased by 4188.88% to $386.00 million when compared to the same quarter last year. In addition, COMERICA INC has also vastly surpassed the industry average cash flow growth rate of 405.62%.
- Despite the stagnant revenue growth, the company outperformed against the industry average of 11.8%. Since the same quarter one year prior, revenues have remained constant. Even though the company's revenue remained stagnant, the earnings per share decreased.
- Compared to its closing price of one year ago, CMA's share price has jumped by 41.23%, exceeding the performance of the broader market during that same time frame. Looking ahead, the stock's sharp rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- COMERICA INC's earnings per share declined by 8.8% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, COMERICA INC increased its bottom line by earning $2.86 versus $2.68 in the prior year. This year, the market expects an improvement in earnings ($3.03 versus $2.86).
- You can view the full analysis from the report here: CMA Ratings Report