Wunderlich Securities is feasting on the fallout from Raymond James' acquisition of Morgan Keegan. The Memphis-based company has recruited three senior VPs in Memphis and another in Dallas. News of their moves comes less than a week after another six people in Memphis and New York made the move.
Six professionals formerly with Morgan Keegan have left the firm for Wunderlich Securities. Four of the people moving on after Raymond James bought Morgan Keegan from Regions Financial are in Memphis, and the other two are in the Big Apple. The moves come shortly after senior Morgan Keegan officials in Nashville and Boston left the company for other pastures.
“Further expansion of equity capital markets and to our private client group is likely, in part because of all the excellent talent that has become available,” Wunderlich said.
We have not changed our investment thesis since initiating in mid-year that FY10 would be a transition year as credit issues peaked; however, the rebound is occurring faster after the credit catharsis in 2Q10 and a pick-up in the economy in 2H10. Also, valuations for quality banks that are perceived as potential sellers have risen with recent M&A activity.At Wunderlich Securities, Kevin Reynolds also has raised his price target for Pinnacle. Reynolds also hiked his rating from 'hold' to 'buy' and now has a target of $18, up from $14. Shares of Pinnacle (Ticker: PNFP) are up some 6 percent this morning to about $15.20.
Pinnacle Financial Partners (PNFP - Buy Rated, $29 price target) - Raising our price target on shares of Pinnacle Financial Partners from $26 to $29, reflecting higher industry valuations on TBV/share and our confidence in the company's ability to grow TBV/share over the coming years. Our new price target approximates 2.2 times our 2009 TBV/share estimate of $13.31, a well-deserved premium to regional and community banks in our research universe.Pinnacle shares (Ticker: PNFP) are up almost 8 percent today, but still below where they spent much of the second half of '08.