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DBS share price to storm back in style?

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DBS share price to storm back in style or is it the start of a protracted nightmare? Under the frenzy attacks by short-sellers, DBS share price went into a tailspin, falling from a high of $30 in April to a low of $25.50 in July. The devastating decline prompted DBS to launch a rare shares buyback on 6 July 2018. For the record, the last shares buybacks by DBS was almost two years ago, in September 2016.

6 July 2018 would be remembered as Black Friday for local bank and property stocks as Singapore government sent the market into chaos with the announcement of additional property cooling measures. DBS stock retreated by 2.6% on that fateful day.

DBS share price is closely watched by many investors in Singapore because it is the biggest cap and is also the crown jewel of Temasek Holdings. Being the bellwether of the economy, bank stocks are typically sensitive to the economy and DBS share price would largely reflect market confidence of the state of Singapore’s economy.

After an incredible bull run that saw DBS share price smashing past the $30 mark, this counter is at a cross road with the recent onslaught of short-selling attacks and the stunning property cooling measures. The two events combined to punctuate the bullish form of DBS share price. Will DBS share price return to form or is it yet another value trap?

DBS share price

DBS share price

The stunning shares buyback halted the decline of DBS share price and helped to restore stability. Since then, DBS share price had stabilized at $26.30 level. A whopping 854,800 shares worth $21.6 million were purchased from the open market, presumably to provide much needed support against bearish sentiments.

The amount paid for the shares buyback was small change given that the short-sellers had wiped off an amazing $11.5 billion off DBS share price in the past three months. But it is important that DBS CEO Piyush Gupta made the purchase because it would help to send a signal to the short-sellers – that the bank is ready to defend DBS share price from indiscriminate attacks.

So is DBS share price currently expensive? With Price/Book Value [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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Updated: July 24, 2018 — 7:29 am

2 Comments

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  1. The 3 local banks were among the top 5 institutional net sell stocks while they were 3 of the top 5 retail net buy stocks last week. Quite interesting.

  2. Hi Leo See,

    That was a brilliant observation! I didn’t catch that one!
    Well, which camps do you think will win – big boys or retail investors? I leave it to you to draw your conclusion but the recent outcome is evident.

    Regards,
    Gerald
    https://www.sgwealthbuilder.com

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