Madrid, July 30, 2015. Banco Santander made an ordinary attributable profit of EUR 3,426
million in the first half, 24% more than the same period last year. Santander’s ten core
markets increased profit, with a particularly important increase in the bank’s three largest
markets: Spain, United Kingdom and Brazil.
Citi Research analyst Stefan Nedialkov wrote in a note that the company’s expectations for the future held some worries. “Some parts of the guidance given were worse than expected, while others were better. On balance, we believe, the negatives (charges of different nature across the geographies, lower Spanish loan growth and Spain NIM pressure) marginally offset the positives (improving asset quality across many geographies),” he wrote.
Take a look at the first half of 2015 EPS and compare it to the first half of 2014. They are exactly the same. There IS a reason. Management is supposed to increase eps and they have not.
Having said that it is cheap and I do own it but this is a very frustrating stock. If you believe that the fed will raise rates then this it will definitely have a negative impact on EM countries (i.e. Brazil) which, in turn, will have a negative impact on SAN. At least that it what the market is projecting.
Santander's net profit rose to 1.71 billion euros in the period, also helped by falling bad debt charges.
Analysts had expected a slightly higher profit and steeper cost cuts.
Shares in the bank were down 1.5 percent by 0800 GMT, reversing earlier gains. Some analysts highlighted disappointing trends in Spain as well as the need to step up revenue growth in the second part of the year.
SPAIN UNDER PRESSURE
Like its peers in Spain, Santander is facing pressure on margins from fierce competition to lend to small businesses.
Add in the Brazil mess and there ya go.
The stock is down on negative growth prospect in Spain. It is a very cheap stock. Unfortunately, its growth prospect remain uncertain.
earnings didn't disappoint as a whole and the uk ( second most important market in Europe for SAN ) was very strong , spain was a bit of a disappointment
the biggest issue holding back this bank is brazil and south America , Santander is very heavily involved in brazil which is a disaster right now
Earnings disappointed apparently. Second quarter profit rose 18%. Provisions for delinquent loans declined 5%. Gross loans increased 13%. NII rose 12%.
the problem for SAN is not Greece or the Eurozone , its problem is brazil which is in awful shape