Banco Santander: Credit Suisse returns to buy rating.
(CercleFinance.com) - This morning Credit Suisse resumed its coverage of the Spanish Banco Santander banking stock with a buy rating ("outperform"), believing that the share's potential is underestimated.
The broker has a target price of 6.1 euros for the share.
"We believe the market is underestimating the earnings contribution from the core units (Spain, Brazil and UK) due to external uncertainties (Cataluña and Brexit) and the lack of visibility on specific issues," such as the pace of the recovery, the low interest rates in Brazil, and the contribution from Banco Popular, an institution recently taken over by Santander which is on the brink of bankruptcy.
According to Credit Suisse, the market has underestimated synergies in Spain, and in 2018 the broker forecasts earnings of about 1.6 billion euros, 7% above the consensus. The broker is also more optimistic than the market on the group's Brazilian operations, while at the same time retaining a "conservative" (below the consensus) scenario for the impact of Brexit.
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The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
The broker has a target price of 6.1 euros for the share.
"We believe the market is underestimating the earnings contribution from the core units (Spain, Brazil and UK) due to external uncertainties (Cataluña and Brexit) and the lack of visibility on specific issues," such as the pace of the recovery, the low interest rates in Brazil, and the contribution from Banco Popular, an institution recently taken over by Santander which is on the brink of bankruptcy.
According to Credit Suisse, the market has underestimated synergies in Spain, and in 2018 the broker forecasts earnings of about 1.6 billion euros, 7% above the consensus. The broker is also more optimistic than the market on the group's Brazilian operations, while at the same time retaining a "conservative" (below the consensus) scenario for the impact of Brexit.
Copyright (c) 2017 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.