Kepler says Handelsbanken is fully valued on dividend hopes, cuts to 'hold'
20/01/2025 12:28
** Kepler Cheuvreux downgrades Svenska Handelsbanken
SHBa.ST to "hold" from "buy" saying the Swedish bank, after
finally repricing, trades close to its fair value following a
strong Q3 and helped by hopes of high dividend
** The brokerage raises its dividend estimate by nearly 10%,
expecting 2024 dividend yield of 12.2%, saying it reflects the
bank's temporary CET1 target buffer of 400 bps
** Kepler sees 2% lower NII for Q4 despite sharply falling
rates, saying it will clearly be a negative if the bank
continues to target a capital buffer of 400 bps for 2025
** But it notes Handelsbanken and Nordea NDAFI.HE have
shown greater NII resilience than Swedbank SWEDa.ST and SEB
SEBa.ST , during both higher and lower rates, and expects this
to continue in the coming quarters
** The broker adds Handelsbanken's perception is
overshadowed by its NII-heavy income mix and weaker-than-peers
profitability outlook
** Handelsbanken will report Q4 results on Feb. 5
** Out of 18 analysts that cover Handelsbanken, four rate it
"strong buy" or "buy", seven "hold" and seven "sell" or "strong
sell"
(Reporting by Marta Frackowiak)
((marta.frackowiak@thomsonreuters.com))