BRD-GSG: Dividend bonanza; what next? (stays HOLD)
BRD’s share price is up 17% ytd, outperforming its peers significantly, supported by the dividend announcements. The bank is planning to distribute a total DPS of RON 3.7 during 1H22E, implying a yield of c.17.8%. Although the dividend announcements provided substantial clarity and the outlook for the earnings in 2022E is positive, we believe that the stock is fully valued, trading at c.1.8x P/TBV and 10.8x P/E on our 2022E. Even if we adjust the share price for the RON 3.7/share dividend, the P/TBV and P/E stand at 1.5x and 9.0x, respectively on, 2022E (i.e., similar to its closest peer, Banca Transilvania). We reiterate our HOLD rating on the stock, but increase our price target (PT) to RON 22/share (from RON 20/share previously).
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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