Wednesday, January 19, 2011

DBS - JP Morgan raises DBS target to $24 from $18

Stock Name: DBS
Company Name: DBS GROUP HOLDINGS LTD
Research House: JP Morgan Chase


JP Morgan raised its target price for DBS Group (DBSM.SI) to $24 from $18 and kept its overweight rating.



JP Morgan said it expects the bank’s low return on equity to reverse over the next three years and rise to 14% in 2013, from 9% in 2009.



DBS is on track to deliver 27% core earnings growth in 2010, and its net interest margin is also expected to increase this year due to a steeper yield curve, JP Morgan said in a report.

"We believe this time it’s different for DBS M&A, as there appears to be greater clarity within top management that value-eroding transactions can lead to a multi-year stock de-rating," the brokerage said.

By 10:48 a.m, DBS shares were up 0.8% at $14.88 and have gained 3.9% so far this year.

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