đŚ Not long ago we wrote about the best and worst European banks and what to expect from them. Today we will focus on the most notorious of them - Credit Suisse.
đ It was previously reported that the company wants to spin off its two divisions (investment and consulting) into separate companies.
đ° Also Credit Suisse plans to revive First Boston, an investment bank, which was bought out in 1990. To do so, it is expected to raise about $1 billion. The Crown Prince of Saudi Arabia is reportedly already willing to invest half of that amount.
đ§ Now for the financials: let's highlight the pros and cons of Credit Suisse
đ˘ Pros:
đ Value, Rank: 88% out of 100%.
đš The bank is cheaply valued by major ratios (P/S is 1.1). However, this is directly related to low investor expectations. Credit Suisse has become unprofitable, so the stock price has fallen a lot this year.
đ´ Cons:
đ Financial position, Rank: 24%.
đ¸ The liability/asset ratio is 94%, the bank is unprofitable, and asset turnover is only 2%, indicating serious problems. Raising additional funds would help to improve it.
đ Growth, Rank: 2%
đ¸ The Ranks system gives a very low rating due to a significant deterioration in the dynamics of key financial indicators. Assets fell by 18% and capital expenditures, on the contrary, rose by 12%.
đ Forecasts, Rank: 24%.
đ¸ Analysts have a mostly negative view of the stock. Not a single recommendation to buy, most of them with a "Hold" rating. No wonder, as the current state of the bank is more than tough.
đŹ To summarize:
âŞď¸ Credit Suisse is trying to save the situation, a number of important and strategic decisions have been made in recent months. The bank is in active search for investors, significant steps have been made in this direction.
âŞď¸ At the moment the financial aspect of Credit Suisse looks very weak, the final Rank 22%
âIn 2008, Credit Suisse stock was worth $70, and now it's worth about $3. Which bank do you think could repeat this fate?
