This post was originally published on this site
Western Alliance Bancorp led a rally in regional bank stocks on Wednesday after the lender said it added $2 billion in deposits from March 31 to April 14.
Adding to the positive sentiment, Wedbush analyst David J. Chiaverini upgraded Western Alliance to outperform — the equivalent of buy — and added the stock to the bank’s Best Ideas list along with New York Community Bancorp Inc.
NYCB,
M&T Bank Corp.
MTB,
and Regions Financial Corp.
RF,
In premarket trades, Western Alliance stock
WAL,
was up 19%, while M&T Bank was up by 0.6%, Regions Financial was up 1.6% and New York Community Bancorp was up 0.9%.
Other regional banks also snapped back from losses in recent weeks. Zions Bancorp
ZION,
rose 3%, First Republic Bank
FRC,
was ahead by 2.8% and PacWest Bancorp
PACW,
was moving up 5%.
“While we experienced elevated net deposit outflows immediately following the closure of other banks, deposit balances quickly stabilized,” Western Alliance said after the closing bell on Tuesday.
Western Alliance stock has been hard-hit in recent weeks after the collapse of Silicon Valley Bank on jitters about a run on deposits.
See now: Silicon Valley Bank: Here’s what happened to cause it to collapse
Related: SVB Financial files for Chapter 11 bankruptcy with about $2.2 billion of liquidity
Western Alliance also reported first-quarter earnings of $1.28 a share, below the analyst estimate of $1.95 a share. It took an after-tax net non-operating charge of $109.7 million related to balance-sheet repositioning, including the sale of some assets and loan reclassifications.
Wedbush analyst Chiaverini said his bank’s outperform rating is based on the expectation that the company should be able to “successfully navigate through this turbulent time” due to its high level of insured deposits (73%), solid outlook for deposit growth, and prudent liquidity measures.
“Given this backdrop, we believe WAL’s valuation is compelling,” he said.
Also Read: Goldman Sachs’s stock falls as profit tops target but revenue falls short
