Goldman Sachs sees Greek banks’ shares moving upwards by an average of 25%. The US investment bank maintained a “buy” recommendation for three of the four shares of the systemic banks and “neutral” for Eurobank, while upgrading the target prices for all four.
Specifically, it set National Bank’s target price at 6.90 euros, Piraeus Bank’s target price at 3.35 euros, Alpha Bank’s at 1.90 euros and Eurobank’s at 1.70 euros.
According to Goldman Sachs analysts, three factors support the estimate for a rally in banking shares.
- The possible recovery of the investment grade within the second half of the year
- The room for upward revision of analysts’ earnings per share estimates
- The prospect of more details being revealed about Greek banks’ plans to pay dividends.
Goldman noted, among others, that Greek banks recorded strong financial performance in the first quarter, exceeding the threshold set by analysts. Regarding the return on equity (ROTE), it raised its estimate to 13% in 2023 and 10% in 2024 from 8% in 2022 while it expects to reach 12% in the medium term, very close to the European average (13%). The CET1 capital adequacy ratio is estimated on average at 14.9% for this year and 15.9% in 2024.
