BMO Capital recommends that investors go long Discover (DFS) and Morgan Stanley (MS) and short Comerica (CMA) and Fifth Third (FITB) ahead of the release of the 2016 CCAR results. BMO says that, after analyzing the stress tests criteria, it prefers banks with less asset sensitivity, limited exposure to capital markets, limited exposure to business outside the U.S., low market expectations for pay-out ratio increases, and high starting capital ratios. For investors expecting an intreest rate hike in June, BMO recommends going long SunTrust (STI) and shorting Comerica and Fifth Third.

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Automotive data and software services provider Solera is weighing an initial public offering that may raise over $1B and has picked banks including Goldman Sachs (GS) and Morgan Stanley (MS) to work on the offering, people familiar with the matter told Bloomberg's Amy Or and Ryan Gould. Solera could launch an offering as soon as in July, the sources noted. Reference Link

Piper Sandler analyst R. Scott Siefers raised the firm's price target on Comerica to $56 from $54 and keeps a Neutral rating on the shares. The Q1 results from the Midwest banks contained no major surprises, and they are "hopefully nearing a positive" net interest income inflection, the analyst tells investors in a research note. Despite the fluid rate environment, managements broadly reiterated NII guides, says Piper.