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UBS: Time to buy MPB

21/09/2009 10:42
In a report dated September 21, UBS upgraded the recommendation for MPB share from sell to buy, as well as its TR from €1.90 to €3.50.

According to the report under the title “Time to buy”, “Marfin has underperformed European and Greek banks by 32% and 45%, justifying our cautiousness up to now. However, Q2 results indicated a substantial improvement in the bank’s core revenue base which we believe is sustainable”.

“Market conditions are improving, providing a further boost to Marfin’s earnings”, it stressed.

“Net interest income is improving, with the dreadful Q1 09 NIM of 1.2% now behind us. Second quarter NIM bounced-back to 1.6% and should continue improving going forward as asset spreads continue expanding and time deposit spreads are improving”, the report said.

“We see significant upside from current levels, considering Marfin’s recent underperformance, substantial discount and improving financials”, it added.

According to the report,, “we upgrade our GGM-derived price target from €1.90 to €3.50, implying a 1.35x PTBV target – still a 15% discount to Europe”.

UBS expects that MPB will enjoy net income of €1176 million in 2009, €1314 million in 2010 and €1408 million in 2011. The net profits are expected to reach €208 million in 2009, €223 million in 2010 and €345 million in 2011. The EPS will stand at €0.24 in 2009, €0.24 in 2010 and €0.39 in 2011.