Magazine article American Banker

Bankers Trust, Morgan Gain an Upgrade from PaineWebber

Magazine article American Banker

Bankers Trust, Morgan Gain an Upgrade from PaineWebber

Article excerpt

Shares of J.P. Morgan & Co. abd Bankers Trust New York Corp. advanced on Friday after they were upgraded to "neutral" from "unattractive" by bank analyst Lawrence W. Cohn of Paine-Webber Group Inc.

On Friday, Morgan rose 25 centss to $68.25, while Bankers Trust was up $2.625 cents to $83.125.

"It's not as if we're beating the drum," Mr. Cohn cautioned during a telephone interview on Friday.

He said both New York money-center banks will likely have lower earnings this year, in contrast to the robust 1993 results from huge bomd and foreign exchange trading profits.

Price Erosion

But the analyst said he raised the ratings because Morgan's stock had eroded 13.5% in value since his "sell" recommendation was made last Sept. 14.

Morgan's dtock was near its 52-week high of $79.375 at that time, but Mr. Cohn saidd then he felt earningd at both Morgan and Bankers Trust had peaked.

On Friday, Morgan's stock "had gotten within 5% of our downside target of $65, and so we felt another look was in order," Mr. Cohn said on Friday. "There was not enough downside left to warrant further selling at current prices."

Logical Pairing

Bankers Trust shares have not fallen as he expected, Mr. Cohn noted. Indeeed, the stock has virtually traded in placee for several months.

"But the two stocks tend to trade together, and it was reasonable to upgrade both of them," the analyst said.

Further downside in Bankers Trust, as well as Morgan, will likely be limited by the stock's dividend yeild, he said. Bankers Trust has a current yeild of 4. …

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