Stephens raises Comerica stock price target to $68 on mixed earnings

Investing.com - Stephens raised its price target on Comerica (NYSE:CMA) to $68.00 from $61.00 on Monday, while maintaining an Equal Weight rating following the bank’s second-quarter earnings report. The bank, currently valued at $8.58 billion, has seen its stock rise 8.28% year-to-date, with analyst targets ranging from $50 to $75. According to InvestingPro analysis, Comerica appears slightly overvalued at current levels.

The bank delivered mixed results for Q2 2025, with growth in loan balances and lower expenses offset by higher deposit costs impacting the net interest margin (NIM). Comerica’s NIM compressed 2 basis points quarter-over-quarter to 3.16%, falling 4 basis points below consensus estimates. Despite these challenges, the bank maintains a strong dividend yield of 4.35% and has impressively maintained dividend payments for 55 consecutive years, as highlighted in InvestingPro’s comprehensive analysis.

Comerica’s net interest income (NII) outlook suggests potential upside over time through organic growth, swaps, and securities repricing. However, the bank expects a decline in NII during the third quarter due to higher funding costs, with deposit costs potentially increasing by 8 basis points quarter-over-quarter.

The projected headwinds suggest Comerica’s NII growth in 2025 will likely be at the lower end of its 5%-7% guidance range. This outlook initially led Stephens to expect Comerica would lag behind its industry peers.

During the earnings conference call, Comerica’s management addressed questions about historical performance, stating that both they and the Board understand their fiduciary responsibility, while also discussing various industry merger and acquisition scenarios, including potentially engaging with third parties. Trading at a P/E ratio of 12.54, InvestingPro data shows the bank trades at an attractive multiple relative to its near-term earnings growth potential. Subscribers can access 7 additional exclusive ProTips and a detailed analysis of Comerica’s financial health through InvestingPro’s comprehensive research report.

In other recent news, Comerica Inc reported its second-quarter earnings for 2025, surpassing analyst expectations with an earnings per share (EPS) of $1.42 compared to the forecasted $1.25. Revenue also exceeded projections, reaching $849 million against the anticipated $843.63 million. Following these results, Comerica’s stock saw a modest pre-market increase. In other developments, DA Davidson raised Comerica’s stock price target to $60 from $56, maintaining a Neutral rating, citing Comerica’s rebound in average loan growth and expected positive momentum in the latter half of 2025. Despite this, the firm noted that Comerica’s net interest income (NII) would likely decrease slightly in the third quarter due to higher deposit costs and preferred stock redemption. Meanwhile, Citi also raised its price target for Comerica to $69 from $61, maintaining a Neutral rating, highlighting modest momentum in loan growth and expressing concerns about uncertain timelines for deposit outflows. These recent developments reflect Comerica’s ability to navigate economic uncertainties while maintaining a strong capital position and shareholder returns.

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