What a fine performance! DBS Group Holdings share price looks set for another rally following the announcement of a solid Q1FY2019 financial performance. On 22 February 2019, I predicted that DBS Group Holdings share price would be on form because of the strong Net Interest Margin (NIM) performance. Since then, the counter surged from $25 to the current $28.
On the basis of the healthy business momentum, DBS Group Holdings share price is likely to continue its dazzling run, perhaps even reaching the $50 mark. Last year’s remarkable run of DBS Group Holdings share price was punctuated by the shock announcement of the tightening of Additional Buyer Stamp Duty (ABSD) and Loan-to-Value (LTV) ratio on residential property purchases. Nonetheless, it appears to me that DBS had managed to shake off the blues and resume its story.
Another reason for the bullish form of DBS Group Holdings share price is the reduction of allowances and non-performing assets (NPA). This is one major downside risk for DBS Group in recent years because of the ailing oil and gas sector. For Q1FY2019, the allowances was halved, dropping from $164million in Q1FY2018 to $76million FY2019. NPA also decreased from $5.8billion to $5.6billion.
Looking at the latest financial results, I could not find any fault with DBS Group Holdings’ performance. But what is surprising is that the management decided to put the icing on the cake by paying dividends four times a year, instead of two times. This would provide shareholders a regular income stream. Given the buoyant feeling, DBS Group Holdings share price is anticipated to go on a rampant bull run.
DBS Group Holdings share price on fire
In this blog, I have mentioned many times that DBS Group Holdings share price is very prone to volatility because of its sensitiveness to the …Read more