reports
- Harry Botha
Investec | Seeing opportunity
Investec should complete its planned demerger with its Asset Management operations (to be renamed Ninety One) in Mar '20. We believe the demerger will result in greater cost and capital efficiency in the banking operations and higher growth potential for Ninety One. We expect the greatest valuation upside for Investec shareholders to stem from improved profitability in the UK bank, as Investec gains scale in its private banking operations and keeps a lid on cost growth. The demerger will incr...
- Harry Botha
Investec | Banking on progress
Investec%u2019s H1 %u201920 results for the Banking and Wealth management operations showed divergent trends in its operations by geography, as the SA operations delivered strong earnings growth in challenging conditions while the UK lagged due to lower investment banking revenues and wealth management investment spend. We expect Investec%u2019s medium-term focus on improved cost and capital efficiency to support the Group%u2019s earnings growth in FY %u201821f and %u201822f despite our forecas...
- Harry Botha
Investec | Value hidden by short-term costs
Investec's H1 '20 (to Sep '19) pre-close guidance was disappointing but reflected challenging conditions for earnings growth. Despite adjustments for restructuring items, management expects lower adjusted EPS y/y in H1 '20 (-4% to -7%) due to muted investment banking and trading revenues in the UK bank. However, the pre-close guidance showed positive trends in annuity revenue streams. UK advances growth (11.5% y/y) and Asset Management net flows (GBP3.3bn in five months) were ahead of our exp...
- Harry Botha
Investec | Built-in resilience
We believe Investec's operational performance in FY '20f reflects resilient trends, as economic conditions constrain growth in SA while Investec's profitability in the UK Specialist Bank continues to improve (as the private bank gains scale). In our view, Investec's conservative liquidity and leverage, and client quality is underappreciated in current conditions. The share price has followed a similar trend to our weighted average peer group since Investec's FY '19 results (-9%), as equally we...
- David Talpert
- Harry Botha
- Warwick Bam
Avior Financials | Standard Bank results | Nedbank meeting notes | Inv...
Standard Bank reported a positive set of H1 ‘19 results as diluted HEPS increased 5.7% y/y. Despite the pressures on SBK's SA operations, we believe SBK's operations outside SA will continue to support upper single digit to low teens Group earnings growth over the next three years. We met with Nedbank management (RBB, CIB, Wealth and Rest of Africa teams, and Group management) yesterday and provide our meeting notes. Investec announced yesterday that the Group has received all necessary reg...
- Harry Botha
- Warwick Bam
1 director sold
A director at Investec Limited sold 100,000 shares at 89.870ZAR and the significance rating of the trade was 96/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two years clear...
- Harry Botha
Investec | Pushing ahead
FY '19 was challenging for Investec in SA and the UK as lower UK credit impairment charges supported operating profit growth y/y. Other than a reduction in Group (or central) costs y/y, Investec's operating efficiency did not reflect management's targets for improvement. The Group's strategic focus remains unchanged, as the Bank and Wealth management business seeks to improve its profitability (particularly in FY '20f and FY '21f), and IAM continues to focus on growth. The IAM demerger suppor...
- Harry Botha
Investec | A challenging second half
Investec's pre-close guidance highlighted muted revenue growth due to challenging operating conditions. Management expects the Group's SA Specialist Bank, Asset Manager and Wealth Manager to report lower operating profit YoY. However, the muted near-term growth does not change our investment case for the stock. Please find our analysis and updated forecasts in this note.
- Harry Botha
Investec | Changing its stripes
Investec's Specialist Banking operations have delivered subpar returns over the last ten years. The average ROE for the Group excluding Asset Management has been 7.4% since FY '11. However, the proposed unbundling of most of Investec's stake in IAM (we expect 60%) has forced the Group to become more disciplined on costs and capital efficiency. The updated Group ROE target range of 12% to 16% excluding Asset Management (from FY ‘22f) exceeded our expectations (previously 11.8% by FY '22f). Cons...
- Harry Botha
Investec | Starting to break the mould
Investec's H1 '19 results highlighted positive trends regarding revenue growth in the UK Specialist Bank. Although Hendrik du Toit and Fani Titi have been joint CEOs of the Group for the last six months, the H1 '19 results reflect the previous management team's efforts in the banking operations. In our discussions with management, we found it encouraging that the joint CEOs identified the need to address the cost efficiency of the Group and the historic investment in low-return initiatives. P...
- Harry Botha
Investec | Charting a more profitable course - *Forecasts updated
Please note that we have changed our forecasts compared to the initial version of this report. Our target price and earnings forecasts have increased. The changes relate to costs in the Asset Management business (impact on target price) and credit impairment charges in the UK bank (no material impact on target price). Investec have changed the methodology for the staff compensation to operating income ratio. The ratio now excludes certain non-compensation related staff costs such as staff tra...
- Harry Botha
Investec | Charting a more profitable course
After 38 years at the helm, Stephen Koseff reported his last set of Investec results, which we characterised as showing positive new business trends but lacked meaningful profitability (Group ROE of 12.1%). Please find our analysis and updated forecasts in this report.
Ford Equity International Rating and Forecast Report
Ford Equity International Research Reports cover 60 countries with over 30,000 stocks traded on international exchanges. A proprietary quantitative system compares each company to its peers on proven measures of business value, growth characteristics, and investor behavior. Ford's three recommendation ratings buy, hold and sell, represent each stock’s return potential relative to its own country market.. The rating reports which are generated each week, include the fundamental details behind...
Unfortunately, this report is not available for the investor type or country you selected.
Report is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.