Trading idea long deutsche bankDocument Transcript
Trading Idea - Long Deutsche Bank Tuesday, October 2nd 2012Company Description Investment Case Last month, Deutsche Bank held its investor day. The Management announced some aggressive financial targets, well above existing consensus estimates.Market Price Data Deutsche Bank will continue strengthening capital ratios. The bank52-week High (€) 39.51 has identified non-core RWAs. Non-core assets will be sold. This is52-week Low (€) 22.11 positive, but we’ll need to see exit costs. Some strong cost measuresLast Price (€) 32.075 are expected to be implemented. But the consensus is cautious. It isYTD Change 8.97% considering only a small part of the company´s targeted cost saves.Mkt Cap (€bn) 29.8137 Transaction banking, retail banking and asset management shouldFloat 96.1% progressively become the bank’s biggest drivers. The company isSource: Bloomberg targeting for higher profits from its non-Investment Banking activities.Analysts Recommendations: The stock has rebounded from its lows. ECB’s more aggressive stance has supported a higher allocation to risk, and to the European banking sector. We acknowledge the bank’s challenges, the transformational nature of its business plan and its high total asset leverage. But, for now, inSource: Bloomberg the current environment, the last investor day could have been whatMarket Multiples was needed to allow the upward movement to go on. P/B 2013 ROE 2013 DY 2013 We define as a stop loss €29.79. We´ll close our trading idea at Est. Est. Est. €36.47.Deutsche Bank 0.50 7.41% 2.39%UBS 0.76 9.28% 3.43%Credit Suisse 0.73 9.93% 3.84% Technical CommentSource: BloombergH2 2012 ReportSummary (in € m.) H1 2012 H1 2011Total net revenues 17,214 19,014Prov. for credit losses 733 837Net Income 2,063Core Tier 1 cap. ratio 10.2% 9.5%ROE (Post Taxes) 7.4% 13.1%Source: DB´s interim Report Q2 2012 www.fincor.pt www.facebook.com/FincorAnnouncement: Fincor—Sociedade Corretora, S.A. provides services of reception, execution, and transmission of orders. The contents men-tioned in this document do not constitute (nor should they be interpreted as to form) any kind of counselling, or investment recommendation, or arecord of our trading prices, or an offer or solicitation to trade in any financial instrument. Fincor—Sociedade Corretora, S.A. Will not accept anyresponsibility resulting from any use referring to said content or about any resulting effect that could have occurred.