great buy. Dividend will change, here’s how

In the wake of the negative intonation of Piazza Affari, Intesa Sanpaolo also travels in red today, while showing greater relative strength compared to the Ftse Mib.

Intesa Sanpaolo down for the fourth session in a row

The stock, after closing last Friday’s session with a drop of almost two and a half percentage points, today drops for the fourth day in a row.

As we write, Intesa Sanpaolo presents itself at 1.8522 euros, with a decrease of 1.48% and over 70 million shares changed hands so far, against the average of the last 30 days of 142 million.

Intesa Sanpaolo: 1st quarter accounts

Intesa Sanpaolo remains under the lens after the group released the accounts for the first quarter last Friday, which closed with a net profit down 32.5% to 1.67 billion euros, excluding value adjustments for Russia and Ukraine.

The net book profit, on the other hand, was equal to 1.024 billion euros, while the operating result rose by 0.2% to 2.91 billion euros.

Loans to customers show an increase of 0.7% to 486 billion euros, while non-performing loans went from 2.13 to 2.14 billion euros.

As for capital ratios, the Common Equity Tier 1 was 13.8% and the Common Equity Tier 1 ratio when fully operational was 13.6%.

Intesa Sanpaolo: news on the future dividend

During last Friday’s conference call, some indications also emerged regarding the future dividend.

CEO Carlo Messina announced that the bank will propose an infrannaule dividend, while from a note it was learned that Intesa Sanpaolo envisages a payout ratio equal to 70% of the consolidated net profit in each year of the Business Plan.

Also of note is the further distribution to shareholders of € 3.4 billion via buyback, subject to the approval of the ECB and a possible further distribution to be evaluated year by year starting from 2023.

Intesa Sanpaolo: Equita SIM’s comment

Commenting on the results released by Equita SIM, analysts speak of a quarterly report higher than expected, mainly due to greater trading and lower operating costs.

As for the outlook for 2022, net profit is expected to exceed € 4 billion, assuming no significant changes in the supply of raw materials / energy.

The net profit is seen well above 3 billion euros in the hypothesis of passage to Stage 3 of a significant part of the exposures to Russia / Ukraine, with average coverage of 40%.

From the call, in addition to other indications on the buy.back and on the payout mentioned above, it emerged that the transition to non-performing exposures of the positions in Russia / Ukraine would not compromise Intesa Sanpaolo’s asset quality profile.

The main assumptions of the 2022 outlook are: substantially flat rates, slightly lower fees and no further use of overlays.

Finally, the strong sensitivity to rates confirmed: +900 million euros of net interest income for 50b basis points of movement in the rate curve.

Intesa Sanpaolo: Equita revises its estimates

Equita SIM analysts have decided to raise 2022 net profit estimates by 10% to 3.7 billion euros, incorporating the positive surprise of the quarter on the trading and operating costs front, partially offset by a higher cost of risk, also to reflect a conservative approach to cross-border exposures.

The estimates for 2023 and 2024 are substantially confirmed.

The bullish view on Intesa Sanpaolo reaffirmed with a “buy” recommendation and a target price of 2.7 euros.
Equita SIM analysts continue to consider Intesa Sanpaolo as a resilient profile and with a diversified business model, which guarantees profitability well above the sector average.

Intesa Sanpaolo: the view of UBS, Kepler Cheuvreux and Deutsche Bank

Bullish also the view of UBS which today reiterated the “buy” rating on the stock, with a target price of 2.7 euros.
Analysts defined Intesa Sanpaolo’s quarterly report as solid, highlighting that the buy-back could come sooner than expected.

Kepler Cheuvreux is also betting on the stock, inviting them to buy, with a fair value reduced from 3 to 2.5 euros.
For the broker, the group’s net profit was in line with consensus and this did not stop analysts from cutting their estimates for eps 2022 by 5%.

For Deutsche Bank, on the other hand, the accounts for the first three months of the year were slightly better than expected at an operational level.



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