As banks extended their rally to a third day Wednesday, Michael S. Mayo, an analyst at Credit Suisse First Boston, said he is standing firm on his year-old bearish outlook for banks. But this time Mr. Mayo, who once was the odd analyst out, has much more company.
Languishing stock prices, lower revenue growth, and some slight fraying in credit quality have made more bank analysts bearish on the sector. According to First Call/Thomson Financial, earnings estimates for the sector continue to slide. Analysts from Prudential Securities, Ryan, Beck & Co., and other brokerages have said they doubt the recent rallies are sustainable.