The fear of further bank woes has taken down some solid stocks that could rebound, including Comerica , according to Citi. The stock, which fell more than 27% on Monday but was rebounding on Tuesday , was one of many regional bank names that came under pressure following the collapse of Silicon Valley Bank of Friday. CMA 5D mountain Shares of Comerica were rebounding on Tuesday. Citi analyst Keith Horowitz said in a note to clients on Tuesday that he is sticking with his buy rating on Comerica and that the stock could see that rebound grow substantially. “Implied COE for banks is now 12.9% representing very good value in our view, and we remain Buy rated on CMA … which has the most forecast upside,” Horowitz said in a note. He has a price target of $90 per share on the stock, which closed below $42 per share on Monday. Horowitz said the bank was likely sold by many investors because of its high percentage of uninsured deposits, at roughly 70%. That is higher than the average bank but well below the levels at SVB and failed Signature Bank. Comerica’s high level of uninsured deposits is reflective of a business tilted toward commercial customers, Horowitz said, which was also the case at SVB and Signature. However, the bank’s average account balance for deposits over the $250,000 insurance threshold was less than half of SVB’s, Horowitz said. That could in theory make Comerica less susceptible to a bank run. Horowitz also said he disagreed with the logic of a move by Moody’s Investor Service to put Comerica’s debt under review for a downgrade. “We would also note that CMA has a 10% [Common Equity Tier 1 capital] ratio which is the highest of the regional banks in our universe and does not seem to be taken into account by Moody’s,” Horowitz said. The ratings service downgraded the entire U.S. banking sector on Tuesday. — CNBC’s Michael Bloom contributed to this report.
