Abu Dhabi Commercial Bank (ADCB UH) United Arab Emirates
Financials
ADCB’s share price has already risen ~40% since Fighting Financials turned bullish in Jul 24, yet they continue to anticipate further upside. The company last week announced its intention to double profits in the next five years. This doesn't seem unreasonable given it doubled profits in the last five years and has good momentum today, having grown PBT at +26% in FY24 y/y. However, consensus is still modelling only mid-single digit annual EPS growth across FY25e and FY26e. ADCB also benefits from the UAE's dollar peg, low tax, geopolitical neutrality and a higher oil price. Fighting Financials core portfolio was up 15% in 4Q24 and is currently +6% YTD with ADCB a key contributor.
Edition: 204
- 07 February, 2025
Abu Dhabi Commercial Bank (ADCB UH) United Arab Emirates
Financials
The share price has risen more than 150% post Covid, but AlphaMena still sees over 30% upside. Strong 1Q24 results were reassuring and AlphaMena remains confident about ADCB’s business model based on the expansion of its core businesses powered by digitisation, portfolio de-risking and disciplined cost management. The lender also possesses the highest rating on AlphaMena’s Fundamental Strength Indicator, a set of metrics that help gauge stocks on their financial and operating performance. The stock continues to trade at a discount to its 2019 P/B while the organic capital generation has noticeably improved. Finally, ADCB offers a generous payout (7% dividend yield).
Edition: 189
- 28 June, 2024