发帖
雷达卡
Upgrading SMFG to Overweight, which becomes our
top pick after Mizuho, OW. Sumitomo Trust and Chuo
Mitsui both remain EW. We downgrade Resona to
Underweight. With earnings recovery being driven by
stabilized credit costs and a lack of equity-related losses,
we favor the banks that benefit most from a decline in
industry risk: Mizuho and SMFG.
BUY signals are poised to turn: The three key data
series that we monitor – 1) the job-offers-to-applicants
ratio, 2) the BOJ Tankan DI (non-manufacturing, small
enterprises), 3) the 10-year JGB yield – all show signs of
bottoming. This is the BUY signal we were waiting for.
Credit costs to peak in 1H F3/10: The job-offers-toapplicants
ratio and the BOJ Tankan DI, which correlate
closely with credit costs, have both bottomed. Stable
credit costs and a rebound in the stock market are
sufficient conditions for bank stocks to appreciate.
The balance of risks is shifting towards the upside:
With limited downside to pre-provisioning net business
profit and credit costs at a turning point, the mega banks
have room for price appreciation as earnings start to
normalize. There is added option value should the
economy improve more rapidly than we forecast.
We maintain our industry view at In-Line: We are
waiting for more evidence that fundamentals as distinct
from macro indicators can improve before moving the
industry to Attractive. In particular, we are looking for
evidence that credit costs have actually peaked,
evidence that loan volumes can grow and margins
improve. In the meantime, we expect a rebound driven
by reduced industry risk and less concern about asset
values.
京公网安备 11010802022788号
