reports
- Nicolas McBeath
Nordea (Buy, TP: SEK155.00) - Resilient returns at a discount
Nordea’s Q1 was a robust quarter, with a resilient >15% ROE on a strong capital position (200bp management buffer) underpinning Nordea’s widening ROE lead versus its peers. We have raised our 2025–2027e EPS by 3–4% and our target price to SEK155 (148). Nordea is trading at a c15% P/E discount to its Swedish large bank peers, which we find unjustified given its superior ROE versus the peer group. We reiterate our BUY.
- Nicolas McBeath
Q1 previews
We see near-term downside risk to NII forecasts, and expect declines to intensify in Q1 as timing effects reverse. Still, we continue to see solid value in the sector and believe recent sell-offs on tariff concerns present attractive buying opportunities, as the market again seems to fail to appreciate the earnings resilience of the Swedish banks. We have cut our 2025–2026e EPS by c5% and our target prices by c15% on average (also reflecting the stocks are trading ex-dividend for 2024). We expec...
Ändring av underliggande
Ändring av underliggande Ändring av underliggande Med anledning av Millicom International Cellulars kommande avnotering från Nasdaq Stockholm kommer Nordea den 17 mars 2025 ändra den underliggande tillgången för de certifikat som anges i [Bilaga A] till Millicom International Cellular, som är noterad på Nasdaq Global Select i USA. Som en följd av att den nya underliggande tillgången är noterad i USA kommer handelstiderna ändras från 09.00-17.25 till 15.30-21.55 och Nordea gör följande övriga ändringar i de slutliga villkoren för de berörda certifikaten: FältÄndras frånÄndras tillValuation...
- Nicolas McBeath
Nordea (Buy, TP: SEK171.00) - Robust capital generation
We view Nordea’s Q4 report as solid, with a >14% ROE and encouraging deposit and asset management volume trends. Our slightly raised 2025-2026 profit estimate forecast c15% ROE. We expect the attractive capital generation and paves the way for robust annual total yields of >10% across our forecast period. Given the healthy profitability outlook, we also find the P/BV of just 1.2x too low. We reiterate our BUY, and have raised our target price to SEK171 (167).
- Nicolas McBeath
Let the yield lead the way
Let the yield lead the way In advance of the Q4 results, we see the best risk/reward in Handelsbanken and less attractive risk/reward in SEB, partly due to our expectations of dividend proposals versus consensus. We have made mostly modest adjustments to our estimates and target prices ahead of the Q4 results. Despite some multiples expansion in Q4, we still see attractive value in the sector, with solid valuation support at a 2025e sector P/E below 10x. We continue to see the capital returns as...
- Nicolas McBeath
Nordea (Buy, TP: SEK167.00) - Buying back its justified appeal
The earlier than expected resumption of Nordea’s buybacks coupled with management’s insistence of a >15% ROE for 2025, despite the lower interest-rate path, signals confidence in its capital and profitability outlook. We have notched up our 2025–2026e EPS by 1–2%, and our target price to SEK167 (165). At a 2025e P/E of 8x, a >10% discount to Swedish peers, we see solid value, and reiterate our BUY.
- Nicolas McBeath
Lower rates to drive higher multiples
We expect Q3 to see an accelerated NII decline and profitability pressure driven by central bank rate cuts. However, we still see attractive return potential in the sector, underpinned by high total sector yields of >10% in 2024–2026e and likely multiples expansion from a currently depressed sector P/E of c8.5x. We prefer the banks with more resilient profitability trends and the strongest capital distribution outlooks. On this basis, Nordea and Handelsbanken remain our top sector picks.
Changes to reference sources for FX and overnight rates
Changes to reference sources for FX and overnight rates Nordea Bank Abp intends to source certain data for base rate calculations and currency components under its programme for Warrants & Certificates, which currently are being sourced from LSEG Data & Analytics (formerly Refinitiv) from Bloomberg. All references to Reuters, Thomson Reuters, Refinitiv or LSEG Data & Analytics shall therefore be construed as references to Bloomberg. These changes will affect all instruments issued in or after 2012 and will be effective as per 11 October 2024. The changes are not expected to be material...
- Nicolas McBeath
Multiple reasons to BUY
Our in-depth analysis of drivers of Swedish banks’ P/E ratios indicates multiples expansion in 2024–2026e, driven by: 1) lower interest rates; 2) a recovery in Swedish house prices; and 3) higher multiples for European bank peers. Our model suggests a sector P/E rise of c15% by 2026e, which coupled with high dividend yields would offer an annual total shareholder return (TSR) of 17% in 2024–2026e for the sector, despite the likely negative earnings trend. This supports our positive sector view, ...
Delisting of Certificates and Mini Future
Delisting of Certificates and Mini Future Nordea Bank Abp, as the issuer, has determined to delist the instruments below and to determine an Expiration Date that will be 17 September 2024. The instruments will be delisted end of trading 17 September 2024. Instrument NDA Isin BULL RHEINMETALL X3 NORDNET SE0021749991 BULL RHEINMETALL X3 NORDNET D DK0062722906 BULL RHEINMETALL X4 NORDNET SE0021750007 BULL RHEINMETALL X5 NORDNET SE0021750015 BULL RHEINMETALL X5 NORDNET F SE0021749884 MINI L RHEINMETALL NORDNET 04 SE0021755733 BEAR GENERAL DYNAMICS X2 NORDNET SE0021007952 At...
- Nicolas McBeath
Nordea (Buy, TP: SEK165.00) - Yield outlook remains reassuring
Despite some near-term capital headwinds, we expect resumed buybacks coupled with generous dividends to generate total yields of c11% for 2025–2026. We see the ROE remaining healthy in 2025–2026, albeit slightly below the 15% target due to cost headwinds and interest rate cuts. We have reduced our 2024–2026e EPS by 2–3% on higher costs and lower buybacks, and our target price to SEK165 (170). However, we find a 2025–2026e P/E of c7.5x attractive, and reiterate our BUY.
- Nicolas McBeath
Attractive valuations despite ROE decline
We expect Q2 to show declining profitability (from lofty levels) in the sector, driven by central bank rate cuts and lingering cost inflation. However, we still see attractive shareholder return potential in the sector, underpinned by robust low-risk earnings, attractive valuations (2025e average P/E 10% in 2024–2026e. We keep our BUY ratings on the banks. Nordea and SHB remain our top sector picks.
Nordea Bank Abp is amending the Base Rate for certain Mini-Futures and...
Nordea Bank Abp is amending the Base Rate for certain Mini-Futures and Unlimited Turbos Pursuant to Condition 18 in Nordea’s Base Prospectus for Warrants & Certificates, Nordea as the issuer has decided to amend the Final Terms for each Mini-Future and Unlimited Turbo issued on or before 13 June 2024 where the Reference Asset is a futures contract (“Affected Instruments”) so that the Base Rate will be “zero (0)” instead of the interest base rate stated in the Final Terms. It is Nordea’s opinion that the amendment is not materially prejudicial to the Holders of Instruments. The ISINs of...
- Nicolas McBeath
Nordea Bank Abp is planning to make fee adjustments in order to addres...
Nordea Bank Abp is planning to make fee adjustments in order to address its increased costs of hedging Due to increased costs Nordea Abp will adjust the Base Rate Margin (which in previous base prospectuses also has been referred to as “räntebasmarginal ”) for Nordea branded bull and bear certificates. The relevant Base Rates may either be decreased or increased on isin level, but the adjustments will in general consist of fee increases. The fee adjustments will be effective from the 14th of June 2024. All affected instruments will be traded just as any other trading day both until and ...
- Nicolas McBeath
Nordea (Buy, TP: SEK169.00) - Buy in the buyback pause
The positive NII trend in Q1 underpins Nordea’s resilient NII outlook, where we forecast flat NII in 2025 versus 2023 despite lower rates. We expect the paused buybacks to resume by year-end, and accelerate in 2025, and that Nordea will still provide 10–11% in total yields for 2024–2026. We expect Nordea to retain an ROE above or around 15% for 2024–2026, and thus find the P/BV of c1.1x too low. We have raised our 2025e EPS by c2% and our target price to SEK169, and we reiterate our BUY.
- Nicolas McBeath
Q1 previews
While we believe the banks are past the NII peak, we forecast healthy and stable ROEs (c16% on average) in Q1, backed by rising commissions, good cost control and low loan losses. We still see attractive shareholder return potential in the sector, underpinned by robust earnings, attractive valuations (2025e average P/E 10% in 2024–2026e. We reiterate our positive sector view and BUYs on all four banks, with c30% average upside to our target prices. SHB remains our sector top pick.
- Nicolas McBeath
Unveiling alpha
Our analysis concludes that adverse FX and valuation multiples trends have masked the banks’ superior underlying shareholder value creation versus other Swedish large caps in the past decade. Our scenario analysis, based on extrapolated underlying earnings, indicates 5%-points potential alpha per year versus the OMXS30 in the next 10 years, with further upside potential should banks’ valuation discounts narrow to historical levels. We prefer banks that can achieve balanced profitable growth to g...
- Nicolas McBeath
Nordea (Buy, TP: SEK157.00) - Capital distributions slowing down
With the Q4 report, Nordea raised its ROE target to >15%, but also flagged some headwinds to its capitalisation, suggesting less scope for share buybacks in 2024–2025. We have cut our 2024–2025e EPS by 1–3%, primarily on lower buybacks, and our target price to SEK157 (165). While we expect Nordea to fall just short of its 15% ROE target in 2025–2026, we still find the P/BV of just 1.2x attractive, and reiterate our BUY.
- Nicolas McBeath
Some dividends now, set for more later
We expect NII trends to have turned negative in Q4, and have cut our 2024-2025e EPS by an average c3% on the lowered interest rate outlook. Despite this, we still see attractive value in the sector, with solid valuation support at a 2024e sector P/E below 8x and attractive capital return potential, where we forecast one-third of sector market cap to be distributed in around two years. We reiterate our BUYs on all banks. In the Q4 results, we expect our sector top pick SHB to propose a 2023 DPS e...
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.