Investec reluctantly downgrades OneSavings Bank
Investec said while it was a ‘firm believer’ in the long-term OneSavings Bank growth story, it “reluctantly” cut its rating to ‘hold’ from ‘buy’.
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The South African bank kept its price target of 365p on OneSavings and suggested the stock might have reached fair value.
Investec said while it was not making a “take profits” call, with shares were now trading at an all-time high, new investors could find better entry opportunities.
Shares in OneSavings had lifted by more than 20% in two days, and which was justified, Investec added.
“We think the sustainability of extraordinary levels of growth and returns had been underestimated by the market, but this “perceptions gap” has now (largely) been closed.”
While challenger bank bosses were scheduled to met with HM Treasury next month, Investec noted OneSavings was not optimised about any relief against the new 8% “bank surcharge.”
Shares in the British bank were down by 5.17% to 345.10p at 1421 BST.