Stock Name: OCBC Bk
Company Name: OVERSEA-CHINESE BANKING CORP
Maybank-Kim Eng Research in a Feb 21 research report says: "While 2011 earnings were flat y-o-y, underlying trends were commendable, with healthy topline growth (investment income aside), cost containment and growing regional contributions (41% of group pretax with 29% of group pretax from OCBC Malaysia).
"OCBC's 2011 core net profit of $2.28 billion (+0.7% y-o-y) was within our and consensus expectations. Net interest income rose 15.7% y-o-y led by loan growth of 27% y-o-y, offset in part by a 12bps compression in net interest margins (NIM).
"However, valuations at this stage are not enticing with the stock trading at a prospective 2012 P/BV of 1.3x for a relatively low prospective 2012 ROE of 10.9%. Our target price of $7.50 tags on a P/BV of 1.1x to the stock. MAINTAIN SELL."
Company Name: OVERSEA-CHINESE BANKING CORP
| Research House: Kim Eng | Price Call: SELL | Target Price: 7.50 |
Maybank-Kim Eng Research in a Feb 21 research report says: "While 2011 earnings were flat y-o-y, underlying trends were commendable, with healthy topline growth (investment income aside), cost containment and growing regional contributions (41% of group pretax with 29% of group pretax from OCBC Malaysia).
"OCBC's 2011 core net profit of $2.28 billion (+0.7% y-o-y) was within our and consensus expectations. Net interest income rose 15.7% y-o-y led by loan growth of 27% y-o-y, offset in part by a 12bps compression in net interest margins (NIM).
"However, valuations at this stage are not enticing with the stock trading at a prospective 2012 P/BV of 1.3x for a relatively low prospective 2012 ROE of 10.9%. Our target price of $7.50 tags on a P/BV of 1.1x to the stock. MAINTAIN SELL."
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