Bendigo and Adelaide Bank’s 1H cash earnings of $260m exceeded the consensus estimate of $228m and Credit Suisse’s forecast for $239.9m.
The analyst forecasts net interest margin (NIM) compression, which is partially offset by improved management of expenses.
The broker is concerned that any future improvement in the cost-to-income ratio is too beholden to management’s view on interest rate rises (6) and maintains a Neutral rating. The $10.25 target price is unchanged.
Sector: Banks.
Target price is $10.25. Current Price is $10.07. Difference: $0.18 – (brackets indicate current price is over target). If BEN meets the Credit Suisse target it will return approximately 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).
