Bank of Cyprus Group Pcl (BOC) is seen reporting a 49% increase in first half profits for the period ending June 30, 2007 giving rise to expectations that it will easily beat and surpass Management’s previous profit estimate for the whole of 2007.
The Mangament team headed by Bank of Cyprus CEO Andreas Eliades and backed by Deputy CEO Charilaos Stavrakis and Group Chief General Manager Yiannis Kypri have continuously managed to exceed market expectations by delivering higher profits, which at the same time has propelled the Bank’s share price higher to the delight, admiration and support of the Group’s more than 70.000 shareholders.
Eliades has placed emphasis on strengthening the Bank’s operations in
The result of this highly successful strategy has been year after year of record growth in profits, increased market share and higher dividends.
The average expectations for Bank of Cyprus profits in the first half of 2007 amount to EUR 217 mln, up 48.6% compared to EUR 146 mln (CYP 85 mln) reported in the first half of 2006.
The most bullish forecast has been issued by CLR Securities and Financial Services at EUR 222 mln, followed by Deutsche Bank at EUR 217 mln, Marfin Egnatia at EUR 215.8 mln and Sharelink Securities and Financial Services at EUR 215.5 mln.
The Financial Mirror estimates BOC 1H07 profit at EUR 215 mln in a range of EUR 210-220 mln.
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2007 profit forecast
All analysts have revised higher their profit expectations for the full year, which is well above the Management’s previous target of EUR 415 mln.
DB and JP Morgan have the highest forecasts on Bank of Cyprus full year 2007 profit, with both forecasts ranging between EUR 462-470 mln for a middle forecast of EUR 466 mln. Citigroup meanwhile sees BOC profit at EUR 458 mln.
Christos Hadjichistodoulou, Head of CLR Research sees Bank of Cyprus 2007 profit at EUR 450-460 mln, while Andreas Constantinou, Head of Sharelink Research says he will issue a revised profit forecast after the presentation of the first half results, but he also states that it will be significantly adjusted higher.
The Financial Mirror estimates BOC full year 2007 profit at EUR 450 mln, which if confirmed would mean that the share price is currently trading on a p/e multiple of 16.5 times 2007 earnings.
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Satisfactory return
The quality of Bank of Cyprus profits and the Management’s track record of delivering the promised results has led many major analysts to revise higher their price targets on the share price of Bank of Cyprus.
The most bullish price target estimate remains the one issued by JP Morgan with a target of EUR 18 per share, which compared to the current level of EUR 13.35, gives a 35% potential return.
DB and Citigroup meanwhile see Bank of Cyprus shares climbing to EUR 17 per share, which based on current levels gives a 27% potential return.
Since the start of the year, the Bank of Cyprus shares have increased by 28%, which combined with the 2.2% dividend yield estimated by the Financial Mirror, give a total return of 30% plus.
