Stock Name: UOB
Company Name: UNITED OVERSEAS BANK LTD
CIMB in a March 14 research report says: "UOB shed 3.5% in the two weeks post-results. Although the headline 4Q was not strong, we think it hid some positives, namely (1) expanding margins ahead; (2) promising build-up in US$ deposit base, and (3) a 4Q earnings that could have been 11-12% higher, ex-EU losses.
"Our estimates suggest that UOB’s 4Q net profit ($558 million) could have been $60 million-$70 million higher, if we back out losses related to the EU bank debt divestment in 4Q. Headline profit would have been 11-12% higher if this did not show up.
"With UOB's $2.3 billion EU bank debt portfolio (4Q10) whittled down to $0.6 billion (4Q11), we think that UOB will surprise on both trading gains and provisions in 1Q12. Our $19.42 target price (GGM, 1.36x P/BV) is unchanged. UPGRADE TO OUTPERFORM."
Company Name: UNITED OVERSEAS BANK LTD
| Research House: CIMB | Price Call: BUY | Target Price: 19.42 |
CIMB in a March 14 research report says: "UOB shed 3.5% in the two weeks post-results. Although the headline 4Q was not strong, we think it hid some positives, namely (1) expanding margins ahead; (2) promising build-up in US$ deposit base, and (3) a 4Q earnings that could have been 11-12% higher, ex-EU losses.
"Our estimates suggest that UOB’s 4Q net profit ($558 million) could have been $60 million-$70 million higher, if we back out losses related to the EU bank debt divestment in 4Q. Headline profit would have been 11-12% higher if this did not show up.
"With UOB's $2.3 billion EU bank debt portfolio (4Q10) whittled down to $0.6 billion (4Q11), we think that UOB will surprise on both trading gains and provisions in 1Q12. Our $19.42 target price (GGM, 1.36x P/BV) is unchanged. UPGRADE TO OUTPERFORM."
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