Shares of Advanta Corp. and First USA Inc. got a boost Thursday, after CS First Boston analyst Samuel G. Liss raised his invesent rating on the credit card companies to "buy" from "hold." First USA rose 75 cents a share to finish the day at $34.625. Advanta's Class A common stock rose $2.25 to finish at $32.75, and its Class B common rose $1.75 to finish at $30.25.
Reeling from intense competition, credit card stocks in general -- and Advanta and First USA, in particular -- have taken a beating recently. But Mr. Liss said the industry's growth is not yet over.
Transaction volume and revolving balance growth will continue to expand 10% to 20% a year, he predicted.
And Advanta and First USA "are aggressively pursuing a no-fee, introductory-rate, balance-transfer strategy," he added.
Other analysts seconded Mr. Liss, saying both companies are in an elite tier of credit card companies and could weather the competitive storm.
Both companies should have strong volume this year, with First USA's receivables jumping 75%, said Susan L. Roth of Kidder, Peabody & Co. She has a "buy" on both stocks.
Bank stocks, meanwhile, were broadly lower Thursday, as the Dow Jones industrial average lost 21.05 points to close at 3,755.43. Bucking the trend was First Interstate Bancorp, Los Angeles, which rose $1 to $78 a share.
Banc One Corp. edged up 37.5 cents a share, to $34.25, after Goldman, Sachs & Co. analyst Robert Albertson reiterated a "priority list buy" on the stock.
Mr. Albertson said he expects Banc One to be among the very best performers in the banking sector, posting a compound average earnings growth rate of 14% through 1996.
Banc One should earn $3.30 per share this year, $3.70 in 1995, and $4.25 in 1996, he said.
The Goldman analyst said his short-term target price for Banc One is $42 to $44 a share and his long-term target is in the low 50s.