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On Thursday, Goldman Sachs initiated coverage of Julius Baer Group Ltd . (BAER:SW) (OTC: OTC:JBAXY), issuing a Buy rating and setting a price target of CHF77.00. The wealth management group, currently valued at $14.2 billion, has demonstrated strong financial health according to InvestingPro analysis, with a robust overall score of 2.76. The investment firm’s coverage began with a positive outlook on the group’s future performance, anticipating sector-leading profitability.
Goldman Sachs expects Julius Baer (SIX:BAER) to achieve a 30% return on tangible equity (ROTE) by 2027, along with a compound annual growth rate (CAGR) of 16% in earnings per share (EPS) compared to 2024. They also forecast a mid-to-high-single-digit growth in assets under management (AuM) annually. These projections build on the company’s current strong performance, with InvestingPro data showing impressive revenue growth of 19.18% and a 16-year track record of consistent dividend payments. Despite these optimistic projections, Goldman Sachs acknowledges a more challenging environment for 2025, with the company’s cost efficiency and recurring margins currently behind target and an expected slowdown in net new money growth. The firm’s profit forecasts for the first half of 2025 are slightly below the Visible Alpha Consensus Data.
Looking beyond 2025, Goldman Sachs predicts that Julius Baer will see continued cost savings, stable-to-improving revenue margins, and a recovery in net new money. These factors are expected to contribute to a significant increase in profit before tax. Moreover, the resumption of share buybacks anticipated in 2026 is likely to further boost earnings per share.
Goldman Sachs’ earnings forecasts for 2026 and 2027 are 9% and 20% ahead of the consensus, respectively. These projections are driven by higher anticipated revenues, stemming from stronger AuM and improved margins, as well as reduced costs due to more rigorous headcount management. The upcoming Strategy Day is expected to emphasize Julius Baer’s efforts to streamline its business operations, which Goldman Sachs believes will be central to achieving these goals.
In other recent news, Julius Baer Group Ltd . has been the focus of several analyst adjustments following its latest financial disclosures. Jefferies downgraded Julius Baer’s stock from Buy to Hold, while raising the price target to CHF58, noting the company’s cost efficiency measures and the absence of near-term share buybacks. Similarly, Kepler Cheuvreux downgraded the stock to Hold, lowering the price target to CHF58, influenced by mixed financial results and concerns over net new money and interest-driven income margin. Citi also downgraded Julius Baer to Neutral, reducing the price target to CHF60, citing challenges related to organizational restructuring under new leadership.
Deutsche Bank (ETR:DBKGn) maintained a Buy rating but reduced the price target to CHF63, reflecting a cautious outlook for 2025 based on management’s guidance and anticipated higher tax rates. Meanwhile, Morgan Stanley (NYSE:MS) adjusted its price target to CHF59 while keeping an Equalweight rating, emphasizing the importance of upcoming strategic updates and regulatory reviews. These recent developments highlight the financial community’s cautious stance on Julius Baer’s near-term prospects, as analysts await further strategic clarity from the new CEO, Stefan Bollinger.
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