Is It Too Late To Consider Comerica After Its Strong 2025 Share Price Rally?

• If you are wondering whether Comerica is still a smart buy after its big run, or if the easier gains have already been made, you are not alone. This is exactly the kind of stock where valuation really matters.
• Comerica's share price has climbed strongly, up 6.1% over the last week, 11.4% over the last month, and 43.5% year to date. That adds to gains of 38.4% over 1 year, 57.4% over 3 years, and 107.7% over 5 years.
• That kind of performance has been supported by a steadier backdrop for US regional banks and improving sentiment toward interest rate policy, which tends to shape how investors view lenders like Comerica. At the same time, ongoing regulatory scrutiny of regional bank balance sheets and funding mixes has kept a spotlight on risk management and capital strength.
• Yet, despite this rally, Comerica currently scores just 0 out of 6 on our valuation checks, suggesting it does not screen as obviously undervalued on traditional metrics. Next, we will walk through the key valuation approaches investors use for a bank like this and then finish with a more holistic way to think about what the stock is really worth.

Comerica scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: Comerica Excess Returns Analysis

The Excess Returns model looks at how much value Comerica can create above the return that investors require on its equity, then capitalizes those excess profits into an intrinsic value per share.

For Comerica, the starting point is a Book Value of $55.15 per share and a Stable EPS estimate of $5.93 per share, based on weighted future Return on Equity forecasts from 13 analysts. With an Average Return on Equity of 10.09% and a Cost of Equity of $4.82 per share, the bank is expected to generate Excess Returns of about $1.11 per share. Analysts also project a Stable Book Value of $58.76 per share over time, using estimates from 11 analysts.

When these excess returns are projected forward and discounted, the model arrives at an intrinsic value of roughly $81.34 per share. Compared with the current market price, the Excess Returns valuation suggests Comerica is about 8.4% overvalued. This is close enough to treat as a reasonable fair value range rather than a major mispricing.

Result: ABOUT RIGHT

Comerica is fairly valued according to our Excess Returns, but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Comerica.

Approach 2: Comerica Price vs Earnings

For a profitable bank like Comerica, the price to earnings, or PE, ratio is a practical way to gauge valuation because it directly links what investors pay today to the profits the business is generating. In general, stronger and more reliable earnings growth can justify a higher PE, while elevated risk or more cyclical results usually call for a discount.

Comerica currently trades on a PE of about 16.3x. That is modestly above the broader Banks industry average of roughly 11.9x and also above the peer group average of about 15.2x. This implies the market is already baking in some premium for its earnings profile. Simply Wall St’s Fair Ratio framework goes a step further by estimating what a “normal” PE should be for Comerica given its specific mix of earnings growth, risk factors, profitability, industry positioning and market cap.

On that basis, Comerica’s Fair Ratio comes out at around 11.9x, noticeably below where the shares trade today. That suggests investors are currently paying more than the model implies is reasonable for the company’s fundamentals, pointing to a stock that screens as somewhat expensive on earnings.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Comerica Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives. This is a simple framework on Simply Wall St’s Community page where you connect your view of Comerica’s story to a set of numbers like future revenue, earnings, margins and a fair value estimate. You can then compare that fair value to today’s price to decide whether you think the stock is a buy, hold or sell. The whole Narrative automatically updates as new news or earnings arrive. You can see, for example, how one investor might build a bullish Comerica Narrative around Sunbelt growth, digital upgrades and merger synergies that supports a higher fair value near the top of the current analyst range. Another investor might focus on flat loan growth, rising costs, competitive pressure and integration risk to justify a fair value closer to the low end. This shows clearly how different perspectives can lead to different, but transparent and testable, conclusions about what the shares are worth.

Do you think there's more to the story for Comerica? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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