Synovus Financial Corp.'s shares fell Thursday after an analyst downgraded the stock amid concern that the Columbus, Ga., company might need to raise additional capital to repay the $968 million it received from the Treasury Department's Troubled Asset Relief Program.
In a research note to investors, Kevin Reynolds, an analyst with Wunderlich Securities, said he was downgrading his rating on the stock from "buy" to "hold" and lowering his 12-to-18 month price target by a $1, to $2.50. With $28 billion-asset company still reeling from losses on construction loans Reynolds said he believes that its earnings power "will be greatly constrained by the potential need to raise significant amounts of common equity in order to exit the Tarp program."
Synovus' shares closed at $2.17, down 4.8%.
