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Research Alert: CFRA Keeps Hold Opinion On Adss Of Deutsche Bank Ag

· 02/04/2021 22:53

03:50 AM EST, 02/05/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We raise our 12-month target price for Deutsche Bank (DBK) by USD1 to USD11, reflecting a P/B of 0.36x, below peer average P/B of 0.63x, justified in our view by DBK's weaker ROE profile. We introduce 2022 EPS of EUR0.90. DBK's Q4 2020 pre-tax profit of EUR175 million beat the company-compiled consensus estimate of a pre-tax loss of EUR39 million. The improvement over the pre-tax loss of EUR1.29 billion in Q4 2019 was driven by higher revenue (+2%, mainly due to trading and advisory revenue at Investment Bank) and lower operating expenses (-21%, lower transformation charges), which more than offset the higher provision for credit losses. We remain cautious of DBK's revenue outlook, as Investment Banking revenue will normalize, in our opinion, while other segments fail to grow their top-line in Q4 2020. Nevertheless, we expect a lower cost base and lower provision for credit losses should ensure an improved result in 2021. We keep our Hold call as we see a balanced risk/reward.