CGS-CIMB analyst Wee Kuang Tay reiterated a Hold rating on DBS Group Holdings (DBSDF – Research Report) today and set a price target of S$43.10.
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Wee Kuang Tay has given his Hold rating due to a combination of factors impacting DBS Group Holdings. The anticipated net profit for the first quarter of 2025 is expected to decline year-over-year, primarily due to higher taxes from the Base Erosion and Profit Sharing (BEPS) initiative, despite a quarter-over-quarter increase. This reflects a resilient pre-tax profit but is overshadowed by the broader economic challenges, including ongoing trade tensions that could dampen earnings for the rest of the fiscal year.
Moreover, while DBS’s capital management strategies, such as its share buyback program and dividend yield, remain robust, the uncertain macroeconomic environment poses potential risks. The softer global economic outlook could lead to weaker loan growth and non-interest income, particularly in wealth management, and could also affect credit quality. These uncertainties have led to a reduction in the return on equity assumption, resulting in a lower target price. Upside potential exists if trade tensions ease, but downside risks include unexpected changes in US interest rates and possible revisions to DBS’s financial guidance.
According to TipRanks, Kuang Tay is ranked #5144 out of 9350 analysts.
In another report released on April 9, Macquarie also downgraded the stock to a Hold with a S$34.17 price target.