Zacks Investment Research Lowers SunTrust Banks, Inc. (STI) to Hold
SunTrust Banks, Inc. (NYSE:STI) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a report released on Wednesday.
According to Zacks, “SunTrust’s shares have outperformed the industry over the past six months. Also, the company has an impressive earnings surprise history. It surpassed the Zacks Consensus Estimate for earnings in all the trailing four quarters. Easing margin pressure, rise in loan demand, initiatives to enhance revenue growth and improve efficiency as well as expected rise in lending activates (owing to the potential lesser regulations) should support the company’s profitability. Also, impressive capital deployment activities reflect strong capital position. However, its significant exposure to commercial and residential loan portfolios remain a concern. Further, expectations of slowdown in mortgage business makes us apprehensive.”
A number of other research analysts have also recently commented on STI. Nomura raised their price target on SunTrust Banks from $62.00 to $63.00 and gave the stock a “neutral” rating in a research report on Thursday, September 28th. FBR & Co cut SunTrust Banks from a “buy” rating to a “neutral” rating and set a $62.00 target price on the stock. in a research report on Tuesday. Keefe, Bruyette & Woods reiterated a “hold” rating and issued a $62.00 target price on shares of SunTrust Banks in a research report on Tuesday, October 3rd. UBS AG reiterated a “neutral” rating and issued a $62.00 target price (up previously from $61.00) on shares of SunTrust Banks in a research report on Friday, October 6th. Finally, Robert W. Baird reiterated a “hold” rating and issued a $55.00 target price on shares of SunTrust Banks in a research report on Sunday, October 1st. Seventeen investment analysts have rated the stock with a hold rating and ten have assigned a buy rating to the stock. The company has an average rating of “Hold” and an average target price of $62.18.
Shares of SunTrust Banks (NYSE:STI) traded down 0.84% during midday trading on Wednesday, reaching $60.25. 2,365,963 shares of the company’s stock traded hands. The stock has a market cap of $28.92 billion, a price-to-earnings ratio of 56.31 and a beta of 1.31. The stock has a 50 day moving average of $56.74 and a 200-day moving average of $56.22. SunTrust Banks has a 52-week low of $44.25 and a 52-week high of $61.69.
SunTrust Banks (NYSE:STI) last issued its quarterly earnings results on Friday, July 21st. The financial services provider reported $1.03 EPS for the quarter, topping the Zacks’ consensus estimate of $0.98 by $0.05. SunTrust Banks had a return on equity of 8.48% and a net margin of 20.51%. The company had revenue of $2.23 billion for the quarter, compared to analysts’ expectations of $2.29 billion. During the same quarter last year, the business earned $0.94 earnings per share. SunTrust Banks’s revenue was up 2.0% on a year-over-year basis. On average, equities research analysts expect that SunTrust Banks will post $4.05 EPS for the current year.
SunTrust Banks announced that its board has authorized a stock repurchase program on Wednesday, June 28th that allows the company to repurchase $1.32 billion in shares. This repurchase authorization allows the financial services provider to reacquire up to 4.9% of its stock through open market purchases. Stock repurchase programs are often an indication that the company’s board believes its stock is undervalued.
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In other SunTrust Banks news, insider Susan S. Johnson sold 808 shares of the stock in a transaction that occurred on Monday, August 14th. The stock was sold at an average price of $57.34, for a total value of $46,330.72. Following the completion of the sale, the insider now owns 3,515 shares in the company, valued at approximately $201,550.10. The transaction was disclosed in a document filed with the SEC, which is available at this link. Company insiders own 0.55% of the company’s stock.
Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Capital World Investors lifted its stake in shares of SunTrust Banks by 20.7% in the 2nd quarter. Capital World Investors now owns 29,513,083 shares of the financial services provider’s stock valued at $1,673,982,000 after purchasing an additional 5,056,000 shares during the period. Janus Henderson Group PLC lifted its stake in shares of SunTrust Banks by 3,033.8% in the 2nd quarter. Janus Henderson Group PLC now owns 2,006,553 shares of the financial services provider’s stock valued at $113,812,000 after purchasing an additional 1,942,524 shares during the period. Lazard Asset Management LLC lifted its stake in shares of SunTrust Banks by 3,009.4% in the 2nd quarter. Lazard Asset Management LLC now owns 1,938,443 shares of the financial services provider’s stock valued at $109,948,000 after purchasing an additional 1,876,101 shares during the period. Investec Asset Management LTD lifted its stake in shares of SunTrust Banks by 64.9% in the 1st quarter. Investec Asset Management LTD now owns 4,321,742 shares of the financial services provider’s stock valued at $238,992,000 after purchasing an additional 1,701,169 shares during the period. Finally, TIAA CREF Investment Management LLC raised its stake in SunTrust Banks by 70.6% during the second quarter. TIAA CREF Investment Management LLC now owns 3,534,925 shares of the financial services provider’s stock valued at $200,501,000 after buying an additional 1,462,517 shares during the last quarter. Institutional investors and hedge funds own 81.18% of the company’s stock.
About SunTrust Banks
SunTrust Banks, Inc is a provider of financial services. The Company’s principal subsidiary is SunTrust Bank (the Bank). The Company’s business segments include Consumer Banking and Private Wealth Management, Wholesale Banking, Mortgage Banking and Corporate Other. As of December 31, 2016, the Consumer Banking and Private Wealth Management segment consisted of three primary businesses: Consumer Banking, Consumer Lending and Private Wealth Management.
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