(June 1 – 15:25 ET) – Merrill Lynch is calling yesterday’s results at Laurentian Bank a “breakthrough quarter”, and raising its estimates for the company this year.
Laurentian reported second quarter earnings of 70¢ a share yesterday, beating analyst estimates by 3¢. Its results were up 30% from the first quarter, and 63% from the second quarter of 1999. The bank’s acquisition of Sun Life Trust added 12¢ to the bottom line in the quarter, although it also took a 5¢ integration charge.
In the wake of the upbeat results Merrill says that it is raising its estimates for 2000 by 10¢ to $2.70. It is maintaining its call for $3.05 a share in 2001. It sees these results as a sustainable reversal of previous poor quarters, noting that the bank’s net interest margin recovered, it has been including integration expenses which should continue for just one more quarter, and the SLT acquisition only impacted two months in the quarter.
Merrill maintains a long-term “buy” on the stock with a $30 12-month target price.
Analysts at Scotia Capital have also upped their rating on Laurentian from a “hold” to a “buy”, with a target of $26.
-James Langton