Magazine article American Banker

Continuing Barrage of Downgrades Helps Drag Industry Prices Lower

Magazine article American Banker

Continuing Barrage of Downgrades Helps Drag Industry Prices Lower

Article excerpt

Bank stock prices continued to wilt under the heat of negative analysts' reports on Thursday, despite gains in broader indexes.

Shawmut National Corp. was lowered to "under-perform" from "neutral" by Stephen Berman of NatWest Securities, who cited the company's exposure to interest rates and the impact on earnings of recent acquisitions. Shawmut's stock was off $1.25 to $21.75.

After lowering his rating on Fleet Financial Corp., in Providence, R.I., earlier in the week, Oppenheimer & Co.'s Chris Kotowski turned his sights on the Midwest, downgrading First Chicago Corp. to "market performer" from "buy." First Chicago's stock slipped $2.25 to $50.75.

About As Far As They Can Go

"Analysts are sending the signal that, at least for the time being, some of the stocks have run pretty far and have reached their price objective," Mr. Berman said. Most of the big losers yesterday have been the group's best performers.

NationsBank Corp. was off $1.125 to $54.25. Fleet, which fell 1.875 on Mr. Kotowski's downgrade on Wednesday, slipped another 87.5 cents to $38.25.

And First Interstate Bancorp, which has lost more than 8% of its value in the last month after having rallied on merger speculation, fell 37.5 cents to $77.875.

Banc One, Wells Fargo Slip

Banc One was down 87.5 cents to close at $36.625. Wells Fargo was off $2.25 to close at $155.50.

Carole Berger of Salomon Brothers attributed the slump to profit taking. …

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