Comerica Inc. (NYSE: CMA) is one of the many banks that have not seen their shares fully recover from the highs prior to the Great Recession. Despite a 3% share price gain to almost $45, this was a $60 stock back in 2007 and a $70 stock briefly in the late 1990s.

With the bank having been a chronic underperformer, there has been speculation that Comerica would potentially put itself up for sale. CLSA’s Mike Mayo brought this up in March. It was the first time in years that he had been positive about Comerica.

Now that Comerica has held its annual shareholders meeting, it turns out that the chatter for a buyout may have more legs. Comerica has hired Boston Consulting Group for a comprehensive review of expenses and revenues.

This is one of those instances where value investing meets a whirlwind filled with the rumor mill, activist investors, logic and value investing. If this does not sound like an easy scenario to ponder, let’s just say that there is a reason it sounds that way.

Hudson Executive Capital and other shareholders have been said to be pushing for a sale of Comerica. Still, at least be some caution should come before any wild excitement about the potential of a sale. Having a broader energy exposure has not been helping its results of late.

With the CEO expressing an interest in selling the bank, if that is the best path, 24/7 Wall St. wanted to see what the bank valuation might fetch.

Comerica’s return on average common shareholders equity fell to 3.1% for the first quarter of 2016, down from 6% the prior quarter. Those energy-related loans have been hurting the Texas-based bank. Again, lower return on equity is not viewed favorably by would-be buyers — unless those buyers are getting it on the cheap and can rapidly turn the ship back around.

Comerica’s share price of almost $45 compares to a consensus analyst target price of $42.32. Does that mean that the bank’s stock is already overvalued? Here are some analyst views on this matter from recent weeks:

• Merrill Lynch raised its rating to Neutral from Underperform, with a $45 price objective, just last week.
• RBC Capital markets has an Outperform rating, and last week it raised its target price to $46 from $44.
• Keefe Bruyette & Woods, a firm that knows banks and financial institutions better than most, maintained a Market Perform rating last week and raised its target to $42 from $41.
• Barclays has an Underweight rating, but last week it raised its target to $42 from $40.

CEO Ralph Babb did sound more open to a sale, noting that Comerica has to earn its right to remain independent each day. What matters here is that Comerica’s highest analyst price target is up at $48 and the current share price is above the consensus analyst target by more than $2.50 — even after the consensus analyst target has risen in recent weeks.

If a sale occurs, there may not be a mega-premium. That being said, you never know what a foreign buyer or a bank looking to expand its footprint might be willing to pay. Stay tuned.

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