UPDATE: J.P. Morgan Lowers PT on New York Community Bank to $17.50 (NYB)

J.P. Morgan is out with its report today on New York Community Bank NYB, lowering its PT from $18.50 to $17.50. In a note to clients, J.P. Morgan writes, "NYB shares trade at 2.35x TBV, a sizable 60% premium to peers. Although the bank faces earnings headwinds, with NYB delivering a 14%+ ROTE in 1Q11, this is already higher than where we expect most banks to be in a more normalized rate environment. Consequently, we believe a substantial premium valuation to peers on NYB stock on a P/TBV basis is fully warranted. Although upside to our revised $17.50 target on its own would render NYB an underperformer, when combined with a very strong 6.2% dividend on the shares, total return potential is in line with peer banks in 2011." J.P. Morgan maintains Neutral on NYB. At the time of posting, shares of NYB were trading at $16.29, up 0.06% from Tuesday's close.