Spanish stock report - Banco Santander

SPAIN

Banco Santander rises in 4 out of last 5 days post dividend October 20, 2017 17:30 CEST

NEWS BITES - EUROPE

Banco Santander, S.A. (MA:SAN), Spain's largest Bank by market cap, has increased 2.90c (0.5%). Compared with the IBEX 35 Index which rose 25.2 points (0.2%) in the day, the relative price increase was 0.3%. The volume was 0.5 times the average daily trading volume of 85.9 million shares. The stock rose in four out of the last 5 trading days, for a 5-day rise of 2.1% to close at EUR5.60

DIVIDENDS

The shares decreased 0.7% in the 2 trading sessions since the ex-dividend date of October 18. The company paid a dividend of 4.0c per share. Based on dividends of 20.88c per share for the trailing twelve months and the last price of EUR5.60 the dividend yield is 3.7%.

Highlights in today's Report:

SECTION 1 BULLISH SIGNALS

Fundamentals, Undervaluation [compared with sector average], Technicals, High Performance Indicators

SECTION 2 BEARISH SIGNALS

Fundamentals, Low Performance Indicators

SECTION 3 PRICE VOLUME DYNAMICS

Volatility, Moving Annual Return, Beta, Aggregate Volumes, Prices and Turnover Period

SECTION 4 RANKING

Global, Independent Ratings

SECTION 5 FINANCIALS

Financials Summary, Annual Report for the year ended December 31, 2016 (year-on-year comparisons with previous corresponding period)-, Trailing 12 Months Dividends

SECTION 6 PROFILE

Activities, Industry & Sector, Issued Capital

SECTION 7 STOCK BUZZ

SECTION 1 BANCO SANTANDER BULLISH SIGNALS

1.1 Fundamentals:

+ The P/E of 13.6 multiplied by the P/NTA of 1.5 is 19.9. Being less than the Benjamin Graham benchmark of 22.5 the stock appears undervalued.

+ Net profit margin has averaged 18.2% in the last 3 years. This is considered superior and suggests a high margin of safety.

+ Brandirectory have estimated Banco Santander brand value at EUR17.1 billion (US$20.1 billion). The Brand Value represents an impressive 9.0% of the estimated Enterprise Value of EUR190.6 billion (US$224.8 billion).

+ As per the Du Pont analysis, Return on Equity is less than stellar at 7.3%. This is computed as net profit margin of 25.4% times asset turnover [sales/assets] of 0.02 times leverage factor [total assets/shareholders' equity] of 14.7.

1.2 Undervaluation [compared with sector average]:

+ Price/Earnings of 13.6 [18.8]. We estimate Banco Santander stock is trading at a current year P/E of 12.7 and a forward year P/E of 11.9.

+ Return on Equity 7.3% [5.0%].

+ Return on Assets 0.6% [0.3%].

1.3 Technicals:

+ The price lifted 2.1% in the last week and increased 1.0% in the last month.

+ Rises to Falls: in the past month the number of rises outnumbered falls 14:9 or 1.6:1.

+ The stock's relative price strength percentile is improving at 59 for 6 months, 71 for 3 months and 73 for 1 month.

+ The present value of EUR1,000 (PV1000) invested one year ago in Banco Santander is EUR1,443, comprising a capital gain of EUR389 and dividend reinvested of EUR54.

PV10001-week1-month1-year
SAN.MA1,0281,0171,443
IBEX 35 Index9989851,128

+ The present value of EUR1,000 (PV1000) invested ten years ago in Banco Santander is EUR1,127, including a capital loss of EUR193 and dividend reinvested of EUR320.

+ 10 years Multiplier in EUR = 1.127x

+ Compound Annual Growth Rate (CAGR) in EUR = 1.2%

Oct 20, 2017: EUR 1 equals USD 1.18

1.4 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverEUR250.9 million (US$295.9 million)In Top 2%
Price/MAP501.02In Top Quartile
Volatility %1.1In Top Quartile
EBITDA Margin %36.3In Top Quartile

SECTION 2 BANCO SANTANDER BEARISH SIGNALS

2.1 Fundamentals:

+ The relative yield of the stock, defined by its yield of 3.7%, divided by average yield of dividend yielding stocks in the IBEX 35 Index of 4.0% is 93.5%. This suggests the stock is overvalued in dividend yield terms.

2.2 Low Performance Indicators:

DescriptionValueRank In Market
Return on Assets [ROA] %0.6In Bottom 6%
Total Debt to Equity2.5In Bottom Quartile

SECTION 3 PRICE VOLUME DYNAMICS

3.1 Volatility:

+ Banco Santander is at a discount of 8.1% to its 12-month high of EUR6.09 on May 08. It is also at a premium of 43.4% to the 12-month low of EUR3.91 on November 09, 2016.

3.2 Moving Annual Return

Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 of the last 5 years. An investment a year ago in SAN would have produced a return of 44.1%.

SANClose (EUR)Dividends (EUR)Capital Gain / (Loss) %% YieldAnnual Return %
Oct 205.60.2138.95.244.1
1 Yr ago4.030.25(9.8)5.5(4.3)
2 Yrs ago4.470.52(14.9)9.9(5.0)
3 Yrs ago5.250.5414.511.826.3
4 Yrs ago4.590.2621.9728.8

Close 5 years ago EUR3.76

3.3 Beta:

+ Beta: the Beta of Banco Santander stock is 1.6. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.

3.4 Aggregate Volumes, Prices and Turnover Period:

[Volume Index or VI in brackets; 1 is average]

+ London: BNC.L 47,741,952 volume 51.54% of aggregate. Price: GBX501.0.

+ Madrid: SAN.MA 44,808,534 [VI of 0.5] volume 48.37% of aggregate. Price: EUR5.60.

+ Aggregate volume: there were 92.6 million shares of Banco Santander worth EUR517.6 million traded today. The aggregate volume was 1.1 times average trading of 86 million shares.

The turnover rate in the 12 months to date was 127.97% (or a turnover period of 9 months). This average length of ownership of the stock at 0.7 times the average holding period of 1 year 26 days for stocks in the IBEX 35 Index suggests a slightly larger number of speculators on the share register, making it less safe for long-term investors.

SECTION 4 RANKING

4.1 Global Rank [out of 47,824 stocks] and Rank in the Europe Region [out of 8,439 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap (US$)105.9B9223
Total Assets (US$)1,586.1B328
Revenue (US$)36.8B377105
Net Profit (US$)7.8B9113
Return on Equity %7.317,2933,092
Net Profit Margin %25.44,420908
Price to Book1.415,2362,567
Price/Earnings13.58,0231,500
Yield %4.54,979874
PV$1000 (1Year) US$*1,5495,2931,112
US$* Change (1Year) %61.75,5481,181

* 1 year ago EUR 1 = USD 1.1

Oct 20, 2017: EUR 1 equals USD 1.18

4.2 Independent Ratings

Banco Santander, S.A. was ranked 10 in the Brand Finance list of the world's 500 Valuable Banking brands by brand value in 2015; a deterioration over a year from rank 8 in 2014. Brand Finance valued the brand at US$18,700 million and ranked it Number 10 in Europe. Most of the brand valuation was for services such as Retail Banking.

It was ranked 18 in SNL's list of Top 100 Banks by Total Assets in 2016; an improvement over a year from rank 20 in 2015.

It is the 64th largest by profit in the FT Global 500.

It was ranked 72 by MCap as at March 31, 2015 by PwC in the Top 100 Global companies; a deterioration over 6 years from rank 65 as at March 31, 2009.

It is the 146th largest by revenue in the Forbes Global 2000.

It was ranked 157 by Newsweek and Corporate Knights Capital in the World's 500 Greenest Companies 2016. It had outstanding scores of 11.9% in Carbon productivity, 7.7% in Energy productivity and 5.9% in Water productivity.

It is placed 19/92 in BSS News Bites' ranking of Spanish performers in the past year, a percentile ranking of 80.

SECTION 5 BANCO SANTANDER FINANCIALS

5.1 Financials Summary

Year endedDec 2016Dec 2015Dec 2014
Sales (USD B)36.867.748.2
Pretax (USD B)13.411.311.5
Net (USD B)7.87.16.9
EPS (EUR)0.41450.44230.4424

Net profit was up 11% from US$7.1 billion in 2015 to US$7.8 billion in 2016. Earnings Per Share (EPS) was down 6.3% from 44.23c to 41.45c.

5.2 Annual Report for the year ended December 31, 2016 (year-on-year comparisons with previous corresponding period)-

Favourable Changes:

+ Net profit up 11% from EUR6.0b ($US6.5b) to EUR6.6b ($US7.0b)

+ EBIT to total assets up 18.3 from 0.7% to 0.8%.

+ Return on Equity up from 6.8% to 7.3%.

+ Retained earnings to total assets up 94% to 7.5%.

+ Net tangible assets per share up 5% from EUR4.03 ($US4.4) to EUR4.23 ($US4.5).

Unfavourable Changes:

+ EPS down 6.7% from 45.0c (US49.61c) to 42.0c (US44.45c).

+ Deposits down 2.1% to EUR829.1b ($US874.5b).

5.3 Trailing 12 Months Dividends

Trailing 12 Months ToValue (c)
20 Oct 201720.88
20 Oct 201624.59
20 Oct 201551.94
20 Oct 201453.95
20 Oct 201326.22

SECTION 6 BANCO SANTANDER PROFILE

6.1 Activities

Banco Santander SA. (the Bank) is a financial group that offers a range of financial products.

6.2 Industry & Sector

Classification LevelName of Sector
Business SectorBanking & Investment Services
Industry GroupBanking Services
IndustryBanks
Economic SectorFinancials

6.3 Issued Capital

Based on 16,040,573,000 issued shares the market capitalisation is EUR89.8 billion (US$105.9 billion).

SECTION 7 STOCK BUZZ

Corporate Wire

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October 18: Banco Santander announces dividend

Banco Santander today announced an interim dividend of 4.0c per share. The ex dividend date is Wednesday, October 18, 2017 and it is payable on Friday, November 03.

July 03: Banco Santander announces dividend

Banco Santander today announced an interim dividend of 6.0c per share. The ex dividend date is Wednesday, August 02, 2017 and the record date is Thursday, August 03, 2017 and it is payable on Friday, August 04.

July 03: Banco Santander announces Right Issue

The company has announced a 10 for 1 rights issue effective Thursday, July 06. To subscribe to new shares the price has been fixed at EUR4.85.

April 07: Banco Santander announces dividend

Banco Santander today announced a final dividend of 5.50c per share. The ex dividend date is Thursday, April 27, 2017 and the record date is Friday, April 28, 2017 and it is payable on Tuesday, May 02.

December 30 2016: Banco Santander announces dividend

Banco Santander today announced an interim dividend of 5.50c per share. The ex dividend date is Monday, January 30, 2017 and it is payable on Wednesday, February 01, 2017.

Physical Address: Ciudad Grupo Santander Boadilla del Monte Madrid, 28660 Spain

State/Province/Country: Spain

Exchange: Bolsa de Madrid

ISIN: ES0113900J37

MA:SAN; MCE:SAN; MC:SAN; SM:SAN; SAN.MC

PermID: 4296154985

Source: www.BuySellSignals.com