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Russia’s Largest Bank Rated A Buy

Analysts mark state-owned Sberbank a buy. Sberbank pays a 50% dividend. Typically, companies that pay out half of their profit in the form of dividends means that the company is a solid, established industry leader in its sector.

Ticker SBER

US Ticker SBRCY
BUY recommendation
Idea release date 09/30/2020
Terms, days 14
Entry price 225.48
Target Price 232.15
Profitability,% per annum 77
Absolute profitability of the transaction, 3%

Analyst comments:

  1. The minimum ratio of the value of common and preferred securities of Sberbank dropped to its lowest ever value: 1.025. This is the lowest level among all other liquid companies in the Russian markets with similar dividend payout structures. The low discount on Sberbank preferred shares promises to rise above 1.06-1.07 in the medium term.
  2. The company has maintained the current dividend policy.
    In addition to the fact that the liquidity of the bank’s ordinary securities is higher than the liquidity of its preferred shares, the bank did not reduce the share of net profit under IFRS directed to dividends, leaving it at 50%.

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