Bank of Cyprus: patience wins the race (stays BUY)
We remain bullish on Bank of Cyprus, despite the strong share price re-rating (+61% in 2022 and a further +60% ytd). The valuation gap has narrowed, but the shares still trade at a P/E of 4.6x on our 2023E, a 30-40% discount vs. its Greek and SEE peers. On P/TBV, Bank of Cyprus trades at c.0.6x, but on a ROTE of above 13%. The stock is one of the best plays on the ECB’s rate hikes (large cash balances at the central bank, low L/D ratio, floating rate loans) and the risk for our earnings forecasts remains on the upside. We remain BUYers, and we increase our price target (PT) to EUR 4.0/share, from EUR 2.7/share.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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