Stifel Nicolaus Upgrades U.S Bancorp to “Buy” (USB)

Stifel Nicolaus reported on Monday that they have upgraded regional banking company, U.S. Bancorp(USB).

The firm, has raised their rating on the company from “Hold” to “Buy,” and has initiated a $39 price target. This price target suggests a 13% increase from the stock’s current price of $33.83.

An analyst from the firm commented, “we arrive at our $39 target price by applying a 12x multiple to our 2014 estimate of $3.25. We believe a premium P/E multiple is warranted, given the company’s superior ROA and earnings levers in the challenging operating environment. Risks to this target price include a weaker-than-expected economic recovery, which could lower earnings estimates because of weak loan growth and/or higher credit losses. In addition, a dilutive acquisition by the company could be viewed negatively by investors.”

U.S. Bancorp shares were mostly flat during Monday morning trading. The stock has increased 16% in the past year.
The Bottom Line

Shares of U.S. Bancorp(USB) have a 2.32% yield, based on Friday’s closing price of $33.65.

U.S. Bancorp(USB) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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