BullnBearTrading wrote a post · May 9, 2023 09:11

JP Morgan see downside to OCBC's results following 'soft' results from Great Eastern

$OCBC Bank (O39.SG)$ will be reporting its quarterly results on May 10.

$JPMorgan (JPM.US)$ analysts have maintained their "underweight" rating for OCBC and lowered their target price to $11.50 from $13.50.

They believe the bank is at risk of weakness over the next three to six months as the economy slows and downside to earnings is expected.

JP Morgan see downside to OCBC's results following 'soft' results from Great Eastern

Great Eastern's 1QFY2023 earnings accounted for 12% of the analysts' earnings estimates for OCBC, which is below the average of 16% for the past eight quarters. The analysts stated that OCBC's weaker asset quality should be the "largest driver" of its stock price moves and any indication of non-performing loan (NPL) formation would lead to sharp de-rating.

The analysts expect OCBC's upside to be limited and any share price movements will be a "function of pricing and fit".

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