Emirates NBD Bank (EMIRATES UH) United Arab Emirates
Financials
AlphaMena maintains a bullish stance on ENBD, viewing the stock’s challenging start to 2025 as an overreaction to its cautious dividend policy, despite a 7% increase in 2024 net profit. The bank’s journey has also been hit by the Turkish political and social crises, fears on Cairo bank acquisition plan and global trade concerns. AlphaMena sees ~40% upside based on intrinsic valuation. Its two-year forward ROE is projected at a solid 17.6%, even amid sector-wide margin pressures and higher taxes across the GCC. They highlight ENBD’s strong retail portfolio, significant exposure to GREs and supportive UAE macro trends as key growth drivers. AlphaMena is also optimistic that Turkey’s economic recovery will support top-line growth, with still-elevated inflation helping partially offset the impact of the interest rate cut.
Edition: 211
- 16 May, 2025
Emirates NBD (EMIRATES UH) United Arab Emirates
Financials
The bank has experienced an impressive rally backed by its ongoing strong operational results. NIM has risen from 2.53% in 2021 to 3.59% at 1H24. Recoveries post Covid combined with a favourable economic backdrop in UAE has helped to achieve >50% EPS growth on average over the last three years. A more generous dividend policy was a key catalyst for the stock last year and AlphaMena expects an improved 1.4 AED dividend per share in line with a 5% increase in 2024 EPS. The recent rally has narrowed Emirates NBD’s P/B historical discount from 35% (2019-23) to 12%. Strong momentum implies investor interest towards the stock can continue. TP AED27 (35% upside).
Edition: 193
- 23 August, 2024