BOSTON (AP) — Following a 40 percent gain over the past three months, there appears to be little more upside room for Webster Financial, according to a report from Jefferies & Co., which downgraded shares of regional bank Friday.
The analyst, Casey Haire, said that Webster's fundamental outlook remains positive, with commercial and industrial loans growing. He also said the parent of Webster Bank continues to realize cost savings and improvement in credit trends.
Haire cut his rating on the Waterbury, Conn. bank to "Hold" from "Buy," noting that shares were trading roughly at his $21 price target. The stock fell to as low as $14.34 on Oct. 4, before rallying in recent months.
That level values the stock roughly in line with shares of its peers, Haire said in a note to clients.
But Haire doesn't see potential for significantly higher earnings at Webster through the end of this year, in part due to persistently low interest rates that are pressuring banks' earnings.
Shares of Webster Financial Corp. slipped 21 cents to $20.94 in premarket trading on Friday.