OCBC (O39) AI Stock Analysis

• Market Cap: $74.47B
• Dividend Yield: 10.62%
• Average Volume (3M): 5.36M
• Price to Earnings (P/E): 9.9
• Beta (1Y): 1.06
• Revenue Growth: 10.17%
• EPS Growth: 8.01%
• Country: SG
• Employees: 33,656
• Sector: Financial
• Sector Strength: 81
• Industry: Banks - Regional
• EPS (TTM): 0.42
• Shares Outstanding: 4,514,995,600
• 10 Day Avg. Volume: 4,411,011
• 30 Day Avg. Volume: 5,360,086
• PEG Ratio: -8.37
• Price to Book (P/B): 1.22
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -13.46
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $16.55
• Price Target Upside: -0.93% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 75 Outperform
• Price Target: S$18.00 ▲(7.72%Upside)

OCBC's stock score benefits significantly from its strong financial performance and attractive valuation. The robust revenue growth, zero debt, and high dividend yield are major positives. However, the technical indicators suggest uncertainty with no clear trend and potential oversold conditions, which slightly moderates the overall score.

Positive Factors

Capital Return

OCBC has reiterated its commitment to the two-year S$2.5bn capital return, including a special dividend equivalent to a 10% dividend payout ratio and ~S$1bn share buyback.

Growth Strategy

Driving growth across Asia to achieve ~13%-14% ROE by 2025 through a refreshed strategy and four growth pillars.

Wealth Management Fees

Wealth management fees rose 18% YoY from higher customer activities and from a higher AUM base.

Negative Factors

Asset Quality

Deteriorating asset quality and higher-than-expected NPLs pose risks to earnings.

Economic Outlook

The earnings growth forecast for FY25 is on shaky ground due to a dampened economic outlook.

Trade War Impact

Potential sequential impact from an escalating trade war suggests caution.

OCBC Business Overview & Revenue Model

Company Description

Oversea-Chinese Banking Corporation Limited (OCBC Bank), headquartered in Singapore, is one of the largest financial services groups in Southeast Asia. Established in 1932, the bank operates across various sectors including consumer banking, corporate banking, investment banking, private banking, insurance, asset management, and treasury services. OCBC Bank offers a comprehensive range of financial products and services to individuals, businesses, and institutions, with a significant presence in key markets such as Singapore, Malaysia, Indonesia, and Greater China.

How the Company Makes Money

OCBC Bank generates revenue through multiple streams primarily associated with its banking and financial services operations. The bank earns interest income from its loan portfolio, which includes mortgages, personal loans, and corporate loans. Additionally, OCBC derives fee-based income from services such as wealth management, brokerage, and investment advisory. The bank also earns from trading and investment activities, including foreign exchange and securities trading. OCBC's insurance subsidiary, Great Eastern Holdings, contributes to revenue through the sale of life and general insurance products. Furthermore, the bank benefits from strategic partnerships and collaborations that enhance its product offerings and market reach, contributing to its overall earnings.

OCBC Financial Statement Overview

Summary

OCBC demonstrates strong financial performance with significant revenue and net income growth, a robust balance sheet with zero debt, and stable shareholder returns. However, the noticeable decline in cash flow from operations highlights potential challenges in cash generation, necessitating a focus on improving cash flow sustainability.

Income Statement

OCBC has demonstrated strong revenue growth, with a significant increase from $13.4B in 2023 to $14.4B in 2024, marking a growth rate of 7.45%. The net profit margin for 2024 is impressive at 52.57%, up from 52.26% in 2023. Despite the lack of reported EBIT and EBITDA margins for 2024, the company has maintained high profitability, indicating efficient cost management and strong operational performance.

Balance Sheet

OCBC exhibits a robust equity position, with a stockholders' equity of $59.3B against total assets of $625B, resulting in an equity ratio of 9.49%. The bank's debt-to-equity ratio has improved significantly, with total debt reduced to zero in 2024, reflecting prudent financial management. Return on equity remains strong at 12.79%, although slightly below the previous year's 13.27%, indicating stable shareholder returns.

Cash Flow

The cash flow statement shows a substantial decrease in operating cash flow from $9.1B in 2023 to $3.96B in 2024, impacting the operating cash flow to net income ratio. Free cash flow decreased to $3.35B in 2024 from $8.59B in 2023, resulting in a negative free cash flow growth rate of -61.01%. The free cash flow to net income ratio remains positive, suggesting ongoing capability to generate cash despite challenges.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	29.95B	14.44B	13.44B	11.19B	10.49B	8.10B
Gross Profit	16.75B	14.44B	13.44B	11.19B	10.49B	8.10B
EBITDA	23.73B	9.50B	8.95B	7.20B	6.20B	5.87B
Net Income	9.23B	7.59B	7.02B	5.53B	4.86B	3.59B
Balance Sheet
Total Assets	602.01B	625.05B	581.42B	559.96B	542.19B	521.39B
Cash, Cash Equivalents and Short-Term Investments	0.00	57.28B	51.74B	61.65B	-7.65B	-7.44B
Total Debt	0.00	31.79B	26.77B	22.63B	29.78B	35.42B
Total Liabilities	602.01B	566.37B	525.87B	505.29B	489.05B	471.42B
Stockholders Equity	57.63B	57.62B	52.92B	53.09B	51.47B	48.42B
Cash Flow
Free Cash Flow	-16.36B	3.35B	8.59B	8.45B	13.84B	15.25B
Operating Cash Flow	8.42B	3.96B	9.13B	8.93B	10.80B	6.48B
Investing Cash Flow	-14.05B	-4.33B	-10.45B	-1.51B	-29.71B	-9.33B
Financing Cash Flow	8.08B	70.00M	355.00M	628.00M	20.02B	5.91B

OCBC Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.71
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:O39, the sentiment is Positive. The current price of 16.71 is above the 20-day moving average (MA) of 16.23, above the 50-day MA of 16.22, and above the 200-day MA of 15.92, indicating a bullish trend. The MACD of 0.11 indicates Negative momentum. The RSI at 71.22 is Negative, neither overbought nor oversold. The STOCH value of 92.24 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:O39.

OCBC Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
S68	78 Outperform	$16.24B	24.73	35.32%	3.03%	8.76%	15.45%
S68	78 Outperform	$16.24B	24.73	35.32%	3.03%	8.76%	15.45%
D05	78 Outperform	S$129.51B	11.59	17.99%	6.63%	13.03%	12.01%
O39	75 Outperform	$74.47B	9.90	13.78%	10.62%	10.17%	8.01%
S41	72 Outperform	S$1.16B	11.16	4.99%	5.79%	3.85%	11.43%
U11	69 Neutral	$60.74B	10.24	13.43%	6.42%	5.68%	5.92%
Sector *	67 Neutral	$16.89B	11.79	9.73%	3.75%	11.97%	-8.33%
G07	62 Neutral	S$12.21B	12.27	12.01%	6.98%	23.83%	28.49%
G07	62 Neutral	S$12.21B	12.27	12.01%	6.98%	23.83%	28.49%

OCBC Corporate Events

OCBC Announces Changes to Audit Committee Composition

OCBC has announced a change in the composition of its Audit Committee with the appointment of Mr. Lian Wee Cheow as a member, effective from July 1, 2025. This decision, approved by the Board and recommended by the Nominating Committee, underscores OCBC’s commitment to maintaining a robust governance structure with independent directors who can exercise unbiased judgment, potentially enhancing the company’s oversight and strategic direction.

The most recent analyst rating on (SG:O39) stock is a Hold with a S$15.90 price target. To see the full list of analyst forecasts on OCBC stock, see the SG:O39 Stock Forecast page.

OCBC Clarifies Position on Great Eastern Holdings Shares

OCBC has clarified its stance regarding the potential privatization and delisting of Great Eastern Holdings (GEH) shares, emphasizing that it has no intention to convert its Class C Non-Voting shares to ordinary shares after the five-year period, as this would affect GEH’s free float status. Despite the confusion caused by recent media reports, OCBC remains committed to its strategic goal of delisting GEH, having increased its economic interest to 93.72% since October 2024, and has stated that its current exit offer is final with no plans for another offer in the near future.

The most recent analyst rating on (SG:O39) stock is a Hold with a S$15.90 price target. To see the full list of analyst forecasts on OCBC stock, see the SG:O39 Stock Forecast page.