Face the markets with BPER Banca securities


As we had the opportunity to write in a previous article (What actions should be included in the year-end portfolio?) To face the markets in this last part of 2019 with BPER Banca could be the right choice to win on the Stock Exchange. However, it must be kept in mind that this is a risky investment. Looking at Consob's daily communication on the open short positions in Piazza Affari, we find that on BPER Banca positions are open for a total capital of 3.8%.

The recent financial news concerning the title date back to a few days ago and highlight the following points:

  • net profit (excluding minority interests) of € 522.93 million, up sharply. However, the management has reported that significant extraordinary items have affected the profit for the nine months.
  • net impaired loans (non-performing loans, unlikely to pay and past due loans) down 1.5% compared to the start of 2019.
  • in the last part of the year, revenues are expected to remain substantially stable.

After the data of the first nine months of the year, facing the markets with BPER Banca could be a bargain.

To read previous articles on BPER Banca click here.

The future growth prospects for BPER Banca

As can be seen from the chart below, BPER Banca is one of the stocks on which to aim for its growth prospects. In fact, growth forecasts for both profits and turnover are much higher than both the reference sector and the Italian market. The following points summarize the state of the art

Earnings vs savings rate and market: The growth of the bank's profits (24.2% per annum) is higher than the savings rate (2.9%) and grows faster than the Italian market (8.6% annually) .

High earnings growth: earnings are expected to grow significantly over the next 3 years.

Revenues vs Market: Turnover (9.3% per year) is expected to grow faster than the Italian market (3.1% per year).

High revenue growth: Revenues (9.3% per year) are expected to grow more slowly by 20% per year.

The Return on Equity should be low in 3 years (6.8%).

The financial situation of BPER Banca

As regards the financial situation of BPER Banca we can say that it is in a neutral condition. The critical points that the management will have to face and resolve in the coming months can be summarized in the following points:

  • Provisions for bad loans (bad loans): the bank has a small fund for bad debts
  • Low risk deposits: the bank has granted significantly more loans than the deposits of the clients it holds.
  • Bad debt level: BPER Banca has a high level of bad loans (12.24%).

Graphic analysis and forecasting

BPER Banca (MIL-BPE) closed the session on November 8th at € 4.219, down 1.1% compared to the previous session.

The current trend, daily time frame, is bullish and despite the fall it remains firmly so. The first price target, reached and exceeded in the last sessions, in fact, continues to resist the downward pressure. The quotations, therefore, are directed towards the 2nd price target in the area € 4.8174. The maximum extension of the current increase is in the area € 5.5197.

The bears could get the upper hand with daily closures lower than € 4,1128.

Even after examining the graphical situation, we can say that facing the markets with BPER Banca could offer an excellent earning opportunity as long as the trading levels indicated as stop are respected.

BPER always on the upside

BPER Banca: bullish projection in progress on the daily time frame. The blue line represents the levels of Running Bisector; the red line the levels of The New Law of Vibration

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