Comerica (CMA) could be a bet on a rebound in the financial sector, particularly if you believe that the U.S. recovery will remain on track and that housing, especially in hard-hit Michigan and California, is likely to rebound.

Comerica is among the 25-largest commercial bank holding companies in the United States. It was formed in 1973 to acquire the outstanding common stock of Comerica Bank, which at such time was a Michigan banking corporation and one of Michigan’s oldest banks.

In 2007, Comerica Bank, a Michigan banking corporation, was merged with and into Comerica Bank, a Texas banking association. As of Dec. 31, 2011, Comerica owned directly or indirectly all the outstanding common stock of two active banking and 49 non-banking subsidiaries with total assets of approximately $61 billion, total deposits of approximately $47.8 billion, total loans (net of unearned income) of approximately $42.7 billion and shareholders’ equity of approximately $6.9 billion.

On July 28, 2011, Comerica acquired all the outstanding common stock of Sterling Bancshares, a bank holding company headquartered in Houston, Texas, in a stock-for-stock transaction. The acquisition of Sterling significantly expanded Comerica’s presence in Texas, particularly in the Houston and San Antonio areas, management reported in a recent filing.

Comerica has three major business segments: the business bank, the retail bank, and wealth management. In addition to the three major business segments, the finance division is reported as a segment.

Comerica has positioned itself to deliver financial services in its four primary geographic markets: Midwest, Western, Texas and Florida. The Midwest market consists of Michigan, Ohio and Illinois. Michigan operations represent the significant majority of the Midwest market.

The Western market consists of the states of California, Arizona, Nevada, Colorado and Washington. California operations represent the significant majority of the Western market. The Texas and Florida markets consist of the states of Texas and Florida, respectively.

In addition to the four primary geographic markets, Comerica also considers national and international finance operations as segments.

“Continued loan and deposit growth, increased customer fee income, tight expense management and solid credit performance reaffirm our focus on improving the bottom line, even in this low-rate environment and slow-growing national economy,” Comerica Chairman Ralph Babb said in a recent call with analysts.

“Our capital position remains strong, and we continue to be active capital managers. We are in the right markets with experienced, dedicated colleagues and the products and services our customers’ desire.”

Comerica has a market cap of $5.7 billion in a sector, commercial banks, where the average company size is $25.71 billion. Its trailing 12-month P/E ratio is 13.28 and its five-year projected price-to-earnings-growth (PEG) ratio is 0.81, compared to 0.67 for the sector.

Its projected earnings per share growth for the coming year is 7.97 percent, compared to a sector average of 13.27 percent.

Meaningful improvement

Wall Street is divided on Comerica, with buy or outperform ratings from UBS, RBC Capital Markets, and Oppenheimer. Citigroup and Goldman Sachs rate the bank a sell.

“We see meaningful improvement in CMA's credit quality, with decreasing net chargeoffs and fewer new nonperforming loans, on an organic basis,” S&P analysts wrote in late April, rating the stock at neutral.

“In 2012, we expect the loan pipeline to grow, particularly from middle-market lending, small business, and auto dealers.”

Comerica next reports on July 17.