Morgan Stanley Upgrades M&T Bank as Short Sellers Retreat

Morgan Stanley upgraded MTB to Overweight on September 8, lifting its price target 20% to $304. The stock trades at $238. That implied upside of 27% from the analyst's desk — and the lending data increasingly supports the bullish read.

The Upgrade That Stands Out

Analyst Manan Gosalia raised the rating from Equal-Weight. The new $304 target sits well above the consensus mean of $260. Most of the street remains cautious: 14 analysts rate MTB Hold, with just two Outperforms alongside the fresh Morgan Stanley Overweight.

Cantor Fitzgerald's Dave Rochester had already raised his target to $285 in August, keeping his Overweight. UBS and JP Morgan both lifted targets in recent weeks while staying Neutral. The Morgan Stanley move is the first outright upgrade in the recent run.

The bull case rests on net interest margin expansion — MTB's NIM hit 3.71% in Q1 2026 — and 4.6% year-on-year growth in commercial and industrial loans. Total revenues rose 5.9% year-on-year to $2.44 billion.

Short Sellers Quietly Heading for the Exits

Since the September 3 article noted the post-spike reversal, shorts have continued to pare back. SI as a percentage of free float has dropped from a peak near 3.9% to 3.35% as of September 9. That is a 14.6% week-on-week decline in the float ratio.

At 3.35% of free float, short interest is modest for a regional bank. The borrow market agrees. Availability sits at 2,565% of short interest — roughly 106 million shares available to borrow against around 5.2 million currently shorted. There is no squeeze pressure here.

Cost to borrow rose 183% over the past week to 0.48%. That sounds dramatic. The absolute level does not. It remains firmly in "low" territory — the CTB spike reflects a near-zero base reading on September 2 (0.17%) reverting to normal levels, not a genuine borrow squeeze.

What the Options Market Says

The put-call ratio has eased since late August. It stood at 0.47 on September 9, near its 20-day mean of 0.44. The Z-score of 1.0 is unremarkable. Options positioning no longer flags elevated bearish sentiment.

Earnings Ahead

Next earnings are scheduled for October 16. The most recent print on July 15 moved the stock +5.0% on the day. That provides a live catalyst for both sides of the trade over the coming five weeks.

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• Price: $238.00 (–0.18% on the day, +1.1% on the week)
• SI % of Float: 3.35%, down 14.6% week-on-week
• Availability: 2,565% — exceptionally loose
• Cost to Borrow: 0.48% (low)
• Morgan Stanley PT: $304 (Overweight); consensus mean $260
• Next earnings: October 16