There's only so many ways to say that a company is largely sitting on the sidelines, but that remains the case for PNC Financial (NYSE:PNC). This low-rate muddle-through market, with some emerging concerns about credit, really just isn't the market in which conservatively-run PNC can truly thrive. Management remains conservative; focusing on quality underwriting and keeping plenty of dry powder for the point where rates start to make lending growth look more attractive.
As one of the bigger year-to-date underperformers within its peer group, PNC does look a little more interesting on a relative value basis. The shares don't look dramatically cheaper than those of JPMorgan (NYSE:JPM), BB&T (NYSE:BBT), or the riskier Wells Fargo (NYSE:WFC), but I can see a scenario where worsening credit trends take a bigger bite out of some of these rivals and leave PNC not exactly "the last man standing" but in a stronger relative position. With that, I think PNC is at least a good hold and maybe a name to think about for more conservative investors who want bank exposure and can tolerate a conservative model that will require time to show its value.
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PNC Financial Still On Hold