Standard Chartered got a modest round of applause for its results today with better-than-expected dividends and buyback news offsetting a miss on earnings.
Impairments from its investment in China Bohai Bank led to the earnings shortfall, said Shore, though the capital position is stronger than expected and the payouts (including a $0.14/share final dividend and a further $1bn share buyback) were ahead of market consensus.
“The outlook is also encouraging, notably for the RoTE (return on equity) to be above 11% in 2024 (previous guidance was 10%) with further growth thereafter, which suggests upside risk to consensus.".
Shore has a buy rating adding: “Although the results were disappointing, the outlook is upbeat with management noting that the pace of economic recovery in its markets is encouraging following the recent opening up of China.
“This, combined with further benefits of rising interest rates, means management is optimistic about the period ahead. “
Jefferies, too, said the tone of the outlook statement points to upgrades ahead.
“Upped guidance on NIM (net interest margin) ROTE imply upgrades to consensus.
The US bank has a 950p target price and a 'buy' stance.
Shares were up .3.9% at 757.6p.