UPDATE 1-RESEARCH ALERT-Baird raises M&T Bank to neutral

(Recasts; adds details, share movement) Oct 10 (Reuters) - Robert W. Baird & Co upgraded M&T Bank Corp (MTB.N) to "neutral" from "underperform" on valuation. The brokerage said the bank holding company's shares, which have fallen about 43 percent since touching a 52-week high in September, have significantly underperformed the broader market.

"We still think M&T is one of the better-managed banks in the industry and the company should continue to take market share from weaker competitors," analyst David George said in a note to M&T should be able to weather the current cycle without raising dilutive equity capital, he said. However, the analyst sees the company's high relative exposure to commercial real estate and construction lending as a risk to its earnings. Shares of M&T were up 5 percent at $67.97 in morning trade at the New York Stock Exchange. (Reporting by Amiteshwar Singh in Bangalore; Editing by Amitha Rajan)