UPDATE: DA Davidson Raises Target to $5 on First California Financial

DA Davidson maintains its Neutral rating on First California Financial FCAL as recent investor groups have called on the board to consider strategic alternatives, including a potential company sale. Deal potential has DA Davidson increase the price target on the company to $5. DA Davidson notes, "Given FCAL's below peer profitability levels and, in our opinion, a lack of levers to improve the earnings power of the institution, we think upside to the stock as an independent company is limited and we have been proponents of FCAL considering other alternatives. Given its 5.1% projected ROE for 2012, the stock, in our opinion, would have likely continued to trade below TBV in the absence of recent M&A speculation driven by the investor activity noted above." FCAL closed at $4.44 a share on Monday.