Deutsche Bank is moving off the sidelines when it comes to U.S. Bancorp . Analyst Matt O’Connor upgraded the bank stock to a buy rating from hold. His price target remained unchanged at $52.50, implying a potential upside of 11% from here. O’Connor pointed to a relatively low bar the company’s earnings need to clear. They are expected to rise just 8% next year, below the projected growth rates analysts expect from peers. However, O’Connor argued that tailwinds for the company could come from fixed rate asset repricing, and noted that U.S. Bancorp benefits more from rate cuts that peers. The analyst also applauded the company’s increased transparency around key drivers and businesses. He also emphasized that the company has built its capital to a “solid” level now, and that the risk of mergers and acquisitions is low. USB YTD mountain USB YTD chart “We don’t view USB as likely to announce a major bank deal anytime soon given current valuations and capital levels (which have been rebuilt but not to the point where there’s much flexibility),” the analyst wrote. “CEO Gunjan Kedia has also only been in her seat for six months (and seems more focused on organic initiatives), and as turnaround efforts are still ongoing.” Meanwhile, O’Connor also wrote that U.S. Bancorp could act as a defensive hedge if credit fears return or rise. “USB is a different bank than it was the last time there was a major credit cycle. That said, USB has long prided itself on strong credit risk mgmt and performance in recent years supports the narrative that volatility within the credit book is low,” he said. Shares of U.S. Bancorp have slipped 1% this year. They gained about 1% after the upgrade. ( Learn the best 2026 strategies from inside the NYSE with Josh Brown and others at CNBC PRO Live. Tickets and info here . )
