June 21, 2024
Investment

Momentum Has Shown That Despite Risks, UBS Is Worthy Investment (Rating Upgrade) (UBS)


SWITZERLAND-RATE-CURRENCY-BANK-BANKING

FABRICE COFFRINI/AFP via Getty Images

Thesis

In the aftermath of my previous article on UBS Group AG (NYSE:UBS), the stock has surged by an impressive 37.67%. In this piece, I aim to elucidate why, despite lingering concerns about underperformance, UBS represents a

CAPM
Risk Free Rate 4.13%
Beta 1.12
Market Risk Premium 6.370%
Required Rate of Return 11.264%

Revenue Operating Income Plus D&A Plus Interest
2023 $40,650.0 $4,148.0 $6,186.31 $6,385.71
2024 $47,840.0 $3,501.3 $5,900.18 $6,134.85
2025 $52,719.7 $9,004.7 $11,648.26 $11,906.86
2026 $58,097.1 $9,709.8 $12,622.97 $12,907.95
2027 $64,023.0 $10,470.1 $13,680.39 $13,994.44
2028 $70,553.3 $11,289.9 $14,827.65 $15,173.73
^Final EBITA^

UBS Credit Suisse Total Net Income Taxes Operating Income
2023 33,758.00 25,821.50 59,579.50 3,693.93 1,626.00 5,319.93
2024 34,703.22 24,961.50 59,664.72 5,119.86 1,626.00 6,745.86
2025 35,674.91 24,101.50 59,776.41 12,313.55 3,133.80 15,447.35
2026 36,673.81 23,241.50 59,915.31 13,543.72 3,446.88 16,990.60
2027 37,700.68 22,381.50 60,082.18 14,789.22 3,763.86 18,553.07
2028 38,756.30 21,521.50 60,277.80 14,645.95 3,727.39 18,373.34

Net Income Margin
6.20%
3.92%
13.62%
13.32%
13.04%
12.76%

Revenue Operating Income Plus D&A Plus Interest
2023 $40,650.0 $4,148.0 $6,186.34 $6,385.73
2024 $59,664.7 $6,745.9 $9,737.66 $10,030.33
2025 $59,776.4 $15,447.3 $18,444.75 $18,737.96
2026 $59,915.3 $16,990.6 $19,994.96 $20,288.86
2027 $60,082.2 $18,553.1 $21,565.81 $21,860.52
2028 $60,277.8 $18,373.3 $21,395.88 $21,691.56
^Final EBITA^



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