Shares of Flushing Financial Corp. have rallied in recent days, after a Sandler O'Neill & Partners LP analyst upgraded them and said they were cheap relative to other thrift stocks.
In a note issued Wednesday, Mark Fitzgibbon, Sandler's director of research, upgraded the $2.6 billion-asset Lake Success, N.Y., company's shares to "buy," from "hold."
The shares have fallen 7% in the past three weeks, but the selloff is overdone, Mr. Fitzgibbon wrote.
Flushing's stock had come under pressure after it reported second-quarter earnings July 25 that missed estimates by 3 cents a share, but investors "misinterpreted the underlying trends," Mr. Fitzgibbon said in an interview.
He commended Flushing's effort to make its balance sheet less thrift-like by adding more commercial loans and deposits. This month it announced a plan to start an Internet-only bank next quarter.
Flushing's shares rose 2% Wednesday and rose slightly Thursday, to $17.28.
