Shares of CoreStates Financial Corp. strenthened further Wednesday amid persistent rumors that the Philadelphia banking company is a takevoer target of either PNC Fiancial Corp. or First Fidelity Bancorp.

CoreStates stock was up 50 cents a share, to $52.25, in afternoon trading and has improved 15% in May after lagging other bank stocks during most of the year. Volume has been brisk.

"I would not be surprised if CoreStates has received an overture," said Nancy A. Bush, an analyst at Brown Brothers, Harriman & Co. "But I would be surprised if it was accepted easily or soon."

CoreStates and Pittsburgh-based PNC have declined to comment on the rumors.

Pursuing Independence

CoreStates has asserted plans to carry on independently. Terrence A. Larsen, its chairman, president, and chief executive officer, asserted in late 1990 that the bank would reach $100 billion in assets in five years.

But Ms. Bush said CoreStates, which had yearend assets of $21.6 billion and ws ranced 31st among bank holding companies, "is no longer of a size that is safe" from takevoer and appears to have few opportunities that could change its status.

Analyst George M. Salem of Prudential Securities Inc. recently upgraded his investment rating on CoreStates to buy from hold - on the basis of improving fundamentals, its undervalued stock, and the probability of a deal with PNC. He sees a one-in-three chance that a PNC deal will happen in the next six to 12 months.

On the basis of fundamentals alone, CoreStates' stock has upside potential to the high $50,s within a year, Mr. Salem said, and a "blended upside" of $60 to $62 a share in case of a merger with PNC.

"PNC can say over twice CoreStates' book value in a stock deal and not dilute its own stock," Mr. Salem said last week. PNC had yearend assets of $44.9 billion and was ranked 15th-largest among bank hodling companies.

At a price of $68 a share for CoreStates, Mr. Salem said, PNC would need only 12% savings from CoreStates' overhead to reach zero dilution to its own earnings per share. Cost savings of 20% would enhance the combined banks' earnings per share by 6% relative to his projection for PNC of a $4.60 per share profit in 1992.

First Fidelity's Handicap

This month, CoreStates' stock price has surged to the equivalent of 1.8 times book value. PNC's shares sell for about 1.65 times book value. Wednesday afternoon, PNC stock was off 37.5 cents, to $53.

First Fidelity, the Lawrenceville, N.J., holding company which had yearend assets of $30.2 billion, has also been mentioned as a possible CoreStates partner. But despite recent upward momentum in its stock price, Fidelity sells for only 1.5 times book value, which would put it at a relative disadvantage as a bidder.

Ms. Bush also cautioned that antitrust considerations might "cause heartburn" in any bid for CoreStates by either of the two larger banking companies. Both PNC and First Fidelity own large banks in Philadelphia.

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