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Investing.com - UBS downgraded Bank of Ireland (OTC:BKRIY) from Buy to Neutral while slightly raising its price target to EUR12.90 from EUR12.70, citing limited upside potential of only 6%.
The Swiss investment bank maintained its sustainable Return on Tangible Equity (ROTE) assumption of 14% for the Irish lender, with the new price target reflecting a shorter discounting period partially offset by a slightly higher cost of equity of 11.9%, up from 11.8%.
At the target price, Bank of Ireland would trade at 9 times its projected fiscal year 2026 earnings per share, according to UBS’s analysis.
UBS expects Bank of Ireland’s share price to remain range-bound amid uncertainty about the economic impact on Ireland from global trade policy changes and other announcements from the United States.
The investment bank also noted that Bank of Ireland’s net interest income and profits are normalizing in a lower interest rate environment, contributing to the more cautious outlook.
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