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On Monday, Deutsche Bank (ETR:DBKGn) increased its price target for BAWAG (VIE:BAWG) Group AG (BG:AV) (OTC: BWAGF) to EUR111 from the previous EUR106, while reaffirming a Buy rating for the stock. BAWAG Group recently outlined its strategic goals up to the year 2027 during its Investor Day, setting an ambitious target of surpassing EUR1 billion in net profit, alongside generating EUR1 billion in excess capital after a 55% dividend payout ratio by 2027.
The bank’s strategy anticipates a compound annual growth rate (CAGR) for net profit exceeding 10%, with management aiming for more than 15% CAGR in core revenue growth, coupled with a yearly net cost reduction of 1-2%. Deutsche Bank’s analysis suggests that while the targets set by BAWAG are challenging, they are within reach, bolstered by the contributions from two recent acquisitions.
The financial institution’s growth strategy is seen as a positive driver for the stock, with the revised price target reflecting confidence in BAWAG’s ability to achieve its financial objectives. Deutsche Bank’s analyst remarked on the feasibility of the targets, noting that the company’s trading position at 8.1 times the projected earnings for 2026 supports an optimistic outlook.
BAWAG’s recent acquisitions are also highlighted as key factors that will contribute to the bank’s growth and help meet the outlined targets. The increase in the price target by Deutsche Bank signals a vote of confidence in the bank’s strategic plan and its potential for shareholder value creation.
Investors will be watching closely to see if BAWAG can deliver on its strategic promises in the coming years. The stock’s performance will likely be influenced by the company’s progress toward achieving the ambitious goals set for 2027.
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