OCBC is projected to maintain a dividend yield of 5.5% for 2025, with a target price of S\$21.00. The bank’s strategic focus on ASEAN markets and a defensively low 2025F P/B of 1.13x makes it an attractive investment. – UOBKH
OCBC is projected to maintain a dividend yield of 5.5% for 2025, with a target price of S\$21.00. The bank’s strategic focus on ASEAN markets and a defensively low 2025F P/B of 1.13x makes it an attractive investment. – UOBKH
OCBC prefers dividends over share buybacks for shareholder returns. With an estimated S\$2.5 billion in excess capital, the bank could potentially return approximately S\$0.55 per share in dividends. The target price (TP) has been raised to S\$17.70, reflecting fewer anticipated US Federal Reserve rate cuts and a progressive recovery in wealth management fees. – CGS
UOB plans to return surplus capital equivalent to 1 percentage point of its Risk-Weighted Assets (RWA) or S\$2.5b back to shareholders. This actionable plan will be announced early next year during the release of its full-year 2024 results. – UOBKH
DBS Group’s current market position warrants a Hold rating. With a target price of S\$43.00, the bank’s earnings are expected to grow modestly over the next few years. The bank’s P/BV (price-to-book value) ratios for CY24F, CY25F, and CY26F are 1.85, 1.74, and 1.66, respectively. DBS Group’s return on equity (ROE) is forecasted at 18.7%, 16.5%, and 15.3% for the same periods. – CGS
DBS Returning Cash and Raising TP
Even with the full implementation of BASEL4, CET1 would be high at 15.2%. Management announced a SGD3 billion share buyback and cancel program, which, upon completion, should reduce CET1 by 0.8 percentage points and increase EPS by 3% at current prices. This program may take 2-3 years. Additionally, DBS is likely to raise progressive dividends higher, and we have upgraded 2024-26 DPS forecasts by 1-11%. The multi-stage discounted dividend model (DDM) with a cost of equity (COE) of 9.9% and a 3% terminal value has raised the TP to SGD46.91 from SGD44.06, maintaining a BUY rating. -Maybank
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