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On Monday, Deutsche Bank (ETR:DBKGn) analyst Benjamin Goy increased the price target on UBS Group AG (NYSE:UBSG:SW) (NYSE: UBS) stock to CHF32, up from the previous CHF31, while maintaining a Buy rating on the shares. The revision follows UBS’s strong performance in the first quarter of 2025, which prompted Deutsche Bank to significantly raise its forecasts for the company’s 2025 earnings by 17%. The adjustments for the subsequent years were more modest, with a 4% increase for 2026 and a 3% increase for 2027. According to InvestingPro data, two analysts have recently revised their earnings upwards for the upcoming period, while the company’s stock has shown strong returns over the last month, trading at $31.51 with a market capitalization of $103.14 billion.
Goy’s commentary highlighted UBS’s consistent delivery across various performance indicators, including top-line momentum, net inflows, and underlying cost reductions. He also pointed out the bank’s effective non-core derisking strategies and its commitment to capital return. However, he noted that new capital requirements are still a concern, with more clarity expected in the coming four weeks. InvestingPro analysis shows the company maintains a GOOD overall financial health score, with particularly strong marks in relative value metrics. The bank has also demonstrated its commitment to shareholders by raising its dividend for 4 consecutive years.
Despite the recent upgrades, Deutsche Bank’s forecasts and the updated target price remain below the levels seen before April 2, 2025. Goy cited UBS’s solid underlying performance, the prospect of gaining more clarity on capital requirements, and an attractive valuation as reasons for reiterating the Buy recommendation. He specifically mentioned the bank’s valuation at 8 times its estimated 2027 earnings per share and a total yield of 10.6% for the same year as appealing factors for investors. Current InvestingPro metrics show the stock trading at a P/E ratio of 20.66, with additional detailed valuation insights and 8 more exclusive ProTips available to subscribers through the comprehensive Pro Research Report.
UBS Group AG has not issued any public statement regarding Deutsche Bank’s revised price target and maintained Buy rating at the time of writing. The market’s reaction to this new target and the analyst’s positive outlook on the bank’s stock will be observed in the upcoming trading sessions. The company’s next earnings report is scheduled for July 30, 2025, which will provide further insights into its performance and strategic initiatives.
In other recent news, UBS Group AG has agreed to a $511 million settlement to resolve a U.S. investigation into Credit Suisse’s tax evasion breaches. This settlement relates to actions taken by Credit Suisse before its acquisition by UBS in 2023. Additionally, UBS is reportedly in negotiations to sell its hedge fund unit, O’Connor, to Cantor Fitzgerald, which may include a revenue-sharing agreement. This move aligns with UBS’s strategy to reduce involvement in riskier businesses amidst stricter Swiss regulations. In another development, RBC Capital Markets has reduced its price target for UBS from CHF36.00 to CHF30.00 while maintaining an Outperform rating, citing the impact of weaker equity markets. UBS’s exposure to equities through its Global Wealth Management and Asset Management divisions makes it sensitive to market fluctuations. Furthermore, UBS has revised its forecast for the Swiss National Bank’s policy rate, anticipating a reduction to 0.0% in June due to economic conditions. The bank’s forecast reflects expectations of lower inflation and potential economic risks.
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