Ahead of the Bell: Valley National downgraded

By Associated Press
September 10, 2008 | Comments (0)

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Keefe, Bruyette & Woods analyst Robert Hughes on Wednesday downgraded the shares of Valley National Bancorp to "Underperform" from "Market Perform," due to a recent rally in the stock price.

"Our lowered rating is not predicated on an expectation for severe credit deterioration, but rather on valuation," wrote Hughes in a note to investors.

Hughes does not expect Valley National to experience the same credit issues as most of its peers, and believes the bank should be able to capitalize on new growth opportunities as a result.

At current levels, the shares are trading 25 percent above Hughes' 12-month target price of $16.

Shares closed Tuesday at $20. Shares have risen 39 percent since July 15.

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