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Investing.com -- Deutsche Bank upgraded Société Générale to “buy” from “hold” and lifted its target price to €63 from €52, pointing to continued profitability improvement despite political uncertainty in France. The new target represents roughly 20% upside from the last close of €52.72.
The bank’s shares have fallen about 10% over the past week, a decline Deutsche Bank attributes to investor concerns over the political backdrop.
The brokerage called the weakness a buying opportunity, arguing Société Générale remains one of the last re-rating stories in the sector.
Analysts forecast return on tangible equity will rise from about 7% in 2024 to 9% in 2025, 10% in 2026, 11% in 2027 and about 11.5% in 2028.
Capital returns are expected to average more than 10% annually over that period, with an emphasis on share buybacks, while the CET1 ratio is seen staying above 13%.
Despite gains of roughly 95% year-to-date, Société Générale still trades at about 7.4× forward P/E and 0.7× price-to-tangible-book, below the European banking sector average of 9× P/E and 1.3× P/TB for 2026 estimates.
Deutsche Bank continues to prefer BNP Paribas, citing greater diversification and lower exposure to France, followed by Société Générale and Crédit Agricole.