Spanish stock report - Banco Santander

SPAIN

Banco Santander down 2.7% in 2 days August 18, 2017 17:30 CEST

NEWS BITES - EUROPE

Banco Santander, S.A. (MA:SAN), Spain's largest Bank by market cap, extended its slide on Friday, shedding an additional 1.10c (0.2%) to close at EUR5.49. The shares have dropped 15.20c (2.7%) over the past two trading days, compared with the IBEX 35 Index which fell 158.6 points (1.5%) in the two days for a relative price change of -1.2%. Cumulative volume in the 2 days was 0.5 times the average 2-day volume of 86.6 million shares.

SECTION 1

BANCO SANTANDER BEARISH SIGNALS

1.1 Technicals:

+ The price dropped 2.4% in the last month. The fall has been exacerbated by firm volume of 1.2 times average for the month.

+ Compared with the IBEX 35 Index which fell 1.3% for the month, this represented a relative price decrease for Banco Santander stock of 1.1% for the month.

1.2 Low Performance Indicators:

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

SECTION 2

BANCO SANTANDER BULLISH SIGNALS

2.1 Fundamentals:

+ The P/E of 13.2 multiplied by the P/NTA of 1.4 is 18.9. Being less than the Benjamin Graham benchmark of 22.5 the stock appears undervalued.

+ The relative yield of the stock, defined by its yield of 3.9%, divided by average yield of dividend yielding stocks in the IBEX 35 Index of 3.8% is 102.6%. This suggests the stock is undervalued in dividend yield terms.

+ 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 9.1% of the estimated Enterprise Value of EUR188.8 billion (US$221.8 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.

2.2 Undervaluation [compared with sector average]:

+ Price/Earnings of 13.2 [19.2]. We estimate Banco Santander stock is trading at a current year P/E of 12.5 and a forward year P/E of 11.7.

+ Return on Equity 7.3% [5.0%].

+ Return on Assets 0.6% [0.3%].

2.3 Technicals:

+ The present value of EUR1,000 (PV1000) invested one year ago in Banco Santander is EUR1,650, comprising a capital gain of EUR582 and dividend reinvested of EUR68.

PV10001-week1-month1-year
SAN.MA1,0039861,650
IBEX 35 Index1,0109791,215

+ The present value of EUR1,000 (PV1000) invested ten years ago in Banco Santander is EUR1,181, including a capital loss of EUR182 and dividend reinvested of EUR363.

+ 10 years Multiplier in EUR = 1.181x

+ Compound Annual Growth Rate (CAGR) in EUR = 1.7%

Present Value of USD1,000 invested 10 years ago:

+ The present value of USD1,000 (PV1000) invested ten years ago in Banco Santander is $US1,028, including a capital loss of $US288 and dividend reinvested of $US316.

+ 10 years ago EUR 1 equalled USD 1.35

+ 10 years Multiplier in USD = 1.028x

+ Compound Annual Growth Rate (CAGR) in USD = 0.3%

Aug 18, 2017: EUR 1 equals USD 1.17

2.4 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverEUR263.4 million (US$309.4 million)In Top 2%
EBITDA Margin %36.3In Top Quartile

SECTION 3

PRICE VOLUME DYNAMICS

3.1 Volatility:

+ Banco Santander is at a discount of 11.2% to its 12-month high of EUR6.18 on May 08. It is also at a premium of 63.5% to the 12-month low of EUR3.36 on August 19, 2016.

3.2 Moving Annual Return

SANClose (EUR)Dividends (EUR)Capital Gain / (Loss) %% YieldAnnual Return %
August 185.490.2158.26.264.4
1 Yr ago3.470.2(33.7)3.9(29.9)
2 Yrs ago5.240.47(6.5)8.51.9
3 Yrs ago5.60.5443.213.756.9
4 Yrs ago3.910.134.83.58.3

3.3 Beta:

+ Beta: the Beta of Banco Santander stock is 1.7. 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]

+ Madrid: SAN.MA 47,979,431 [VI of 0.6] volume 90.32% of aggregate. Price: EUR5.49.

+ London: BNC.L 4,944,185 [VI of 0.4] volume 9.31% of aggregate. Price: GBX500.0. Using the current exchange rate of EUR1 equals 91.07GBX.

+ Xetra: BSD2.ETR 97,762 [VI of 1.1] volume 0.18% of aggregate. Price: EUR5.51.

+ Lisbon: SANT.LS 76,350 [VI of 1.3] volume 0.14% of aggregate. Price: EUR5.50.

+ Aggregate volume: there were 53.1 million shares of Banco Santander worth EUR291.6 million traded today. The aggregate volume was 0.5 times average trading of 101 million shares.

SECTION 4

RANKING

4.1 Global Rank [out of 47,594 stocks] and Rank in the Europe Region [out of 8,387 stocks]

DescriptionValueGlobal RankIn Eur Region
MCap (US$)103.4B8422
Total Assets (US$)1,569.5B317
Revenue (US$)36.4B37499
Net Profit (US$)7.8B9113
Return on Equity %7.317,0163,050
Net Profit Margin %25.44,412895
Price to Book1.415,6912,577
Price/Earnings13.36,9281,456
Yield %3.96,2441,105
PV$1000 (1Year) US$*1,7214,265886
US$* Change (1Year) %65.14,734976

* 1 year ago EUR 1 = USD 1.13

Aug 18, 2017: EUR 1 equals USD 1.17

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 15/92 in BSS News Bites' ranking of Spanish performers in the past year, a percentile ranking of 84.

SECTION 5

BANCO SANTANDER FINANCIALS

5.1 Financials Summary

Year endedDec 2016Dec 2015Dec 2014
Sales (USD B)36.767.548
Pretax (USD B)13.311.311.5
Net (USD B)7.876.9
EPS (EUR)0.41450.44230.4424

5.2 Trailing 12 Months Dividends

Trailing 12 Months ToValue (c)
18 Aug 201721.5
18 Aug 201620.27
18 Aug 201547.36
18 Aug 201453.65
18 Aug 201313.07

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 EUR88.1 billion (US$103.4 billion).

SECTION 7

STOCK BUZZ

Corporate Wire

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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.

October 18 2016: Banco Santander announces dividend

Banco Santander today announced an interim dividend of 4.50c per share. The ex dividend date is Tuesday, October 18, 2016 and it is payable on Thursday, November 03.

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