) to underperform.
Analyst Andrew Collins says the company's 46 cents is below his 65 cents estimate and the Street's 68 cents consensus, mostly due to lower net interest income, mortgage banking revenues, securities gains, and partially offset by a net tax benefit.
He cuts his $2.70 fiscal 2005 (ending June) earnings per share estimate to $2.21, and $2.90 fiscal 2006 estimate to $2.00, on concerns over net interest margins under flattening rate curve scenario and lower non-interest income.
While Collins thinks the company is taking steps to address its balance sheet structure, nevertheless he believes the company could experience meaningful margin pressure during fiscal 2005 through fiscal 2006. He cuts his $26 target to $17.