Comerica is converted and fourth-quarter profit is the new run rate. I model $5.15 of 2027 earnings at eleven times, a $57 stock, about 13 percent above $50.56 including the dividend.
Key points
- $1.13 adjusted third-quarter EPS; GAAP was $0.90 after $0.23 of merger and legal items.
- $850 million annual expense-synergy target is still the fourth-quarter run-rate commitment.
- 11 times my $5.15 of 2027 earnings produces a $57 share, 13 percent above $50.56.
The call
The price of $50.56 needs about 9.8 times my 2027 earnings of $5.15. That is cheap versus other large regionals I cover at ten to eleven times, but the three-month lag versus the market is the Comerica conversion and higher rates hitting AOCI.
I believe conversion is finished and fourth-quarter PPNR grows about 9 percent as remaining savings hit. I model $5.15 next year and apply eleven times, a $57 stock. The market is too pessimistic on run-rate profit after a messy merger year.
FTE revenue by quarter ($ billions)- Reported FTE revenue
- My Q4 estimate
Company releases through Oct 19, 2026; Q4 2026E is my estimate
Valuation
| Item | Figure |
|---|
| 2027 net interest income | $9.68 billion |
| 2027 fees | $4.46 billion |
| 2027 EPS (my model) | $5.15 |
| Multiple | 11 times |
| 12-month target | $57 |
| Dividend (next twelve months) | $1.68 |
Eleven times matches the regional-bank multiple I use on USB, CFG and MTB. Upside is the synergy run rate plus a modest multiple catch-up; downside is deposit costs and AOCI if rates keep rising. The dividend cushions a miss.
Earnings per share, GAAP then my 2027 estimateSEC facts and Oct 19 release; 2026 is merger-year GAAP; 2027E is my model
Risks
- Deposit costs rise faster than asset yields if AI cash tools move balances; watch sequential interest-bearing deposit cost versus 2.24%.
- Credit worsens from 31 basis points of charge-offs; watch NPLs above 0.59% of loans.
- CET1 stays near 10% and buybacks stay small if AOCI losses grow; watch the $200, $300 million fourth-quarter repurchase.
What would change my mind
A fourth-quarter adjusted efficiency ratio still above 55% after the remaining synergies.