Latest revision |
Your text |
Line 36: |
Line 36: |
|
| |
|
| UBS is a preeminent global financial advisory and solutions provider, catering to private, institutional, and corporate clients across the world, with a particular emphasis on Swiss private clients. With a widespread presence in major financial centers, our recent integration with Credit Suisse enhances our capabilities, offering clients elevated value, a broader spectrum of services, and an extended global reach, reaffirming UBS's role as a driver of financial achievement.<ref>https://www.ubs.com/global/en/our-firm/what-we-do.html</ref> | | UBS is a preeminent global financial advisory and solutions provider, catering to private, institutional, and corporate clients across the world, with a particular emphasis on Swiss private clients. With a widespread presence in major financial centers, our recent integration with Credit Suisse enhances our capabilities, offering clients elevated value, a broader spectrum of services, and an extended global reach, reaffirming UBS's role as a driver of financial achievement.<ref>https://www.ubs.com/global/en/our-firm/what-we-do.html</ref> |
|
| |
| Considering UBS Group AG's strategic trajectory and integrated assumptions, our analysis envisions a potential 53.5% return over five years, correlating to an average annual growth rate of about 10.7%. This projects a £100,000 investment in UBS potentially growing to around £153,500 within five years, considering the foreseen upside. These insights amalgamate Stockhub user perspectives, our detailed DCF model, and current market valuation.
| |
|
| |
|
| == Operations == | | == Operations == |
Line 83: |
Line 81: |
|
| |
|
| == Markets == | | == Markets == |
|
| |
| === Total Addressable Market ===
| |
| Total Addressable Market: Here, the total addressable market (TAM) is defined as the global financial services market, and based on a number of assumptions, it is estimated that the size of the market, in terms of revenue, is $28.1 trillion.<ref>https://www.thebusinessresearchcompany.com/report/financial-services-global-market-report</ref>
| |
|
| |
| === Serviceable Available Market ===
| |
| Serviceable Available Market: Here, the serviceable available market (SAM) is defined as the global commercial banking market, and based on a number of assumptions, it is estimated that the size of the market, in terms of revenue, is $2.8 trillion.<ref>https://www.ibisworld.com/global/market-size/global-commercial-banks/</ref>
| |
|
| |
| === Serviceable Obtainable Market ===
| |
| Serviceable Obtainable Market: Here, the serviceable obtainable market (SOM) is defined as the US commercial banking market, and based on a number of assumptions, it is estimated that the size of the market, in terms of revenue, is $1.1 trillion.<ref>https://www.ibisworld.com/industry-statistics/market-size/commercial-banking-united-states/</ref>
| |
|
| |
|
| == Competition == | | == Competition == |
Line 168: |
Line 157: |
| UBS Group AG's financial performance exhibited stability over the years, with modest revenue fluctuations and steady net income growth. Despite the dynamic economic landscape, the company's revenue remained above $30 billion from 2019 to 2022. This consistent growth suggests effective management strategies. Further analysis of factors influencing these trends would provide a more comprehensive understanding. | | UBS Group AG's financial performance exhibited stability over the years, with modest revenue fluctuations and steady net income growth. Despite the dynamic economic landscape, the company's revenue remained above $30 billion from 2019 to 2022. This consistent growth suggests effective management strategies. Further analysis of factors influencing these trends would provide a more comprehensive understanding. |
| [[File:Financials UBS.png|center|thumb|500x500px]] | | [[File:Financials UBS.png|center|thumb|500x500px]] |
| | |
| | == Disocunted Cash Flow (DCF) == |
| | Outlined below is the Discounted Cash Flow (DCF) analysis for UBS Group AG. The computations have been performed using Bloomberg Terminal. |
| | '''Assumptions:''' |
| | * Revenue Growth Rate: 0% |
| | * Operating Margin: 28.87% |
| | * Tax Rate: 21% |
| | * Discount Rate (WACC): 8.19% |
| | * Terminal Growth Rate: 2% |
| | |
| | ==== Forecast Period: 5 years Calculate ==== |
| | |
| | ==== Free Cash Flows (FCF): ==== |
| | {| class="wikitable" |
| | !Year |
| | !Revenue |
| | !Operating Income |
| | !EBT |
| | !Taxes |
| | !NOPAT |
| | !Depreciation & Amortization |
| | !Operating Cash Flow |
| | !CAPEX |
| | !Working Capital Changes |
| | !Free Cash Flow |
| | |- |
| | |2022 |
| | |$33,270,000,000 |
| | |$9,609,369,900 |
| | |$9,609,369,900 |
| | |$2,018,167,879 |
| | |$7,591,202,021 |
| | |$2,061,000,000 |
| | |$9,652,202,021 |
| | | -$1,643,000,000 |
| | |$18,228,000,000 |
| | |$29,237,202,021 |
| | |- |
| | |2023 |
| | |$33,270,000,000 |
| | |$9,609,369,900 |
| | |$9,609,369,900 |
| | |$2,018,167,879 |
| | |$7,591,202,021 |
| | |$2,061,000,000 |
| | |$9,652,202,021 |
| | | -$1,643,000,000 |
| | |$18,228,000,000 |
| | |$29,237,202,021 |
| | |- |
| | |2024 |
| | |$33,270,000,000 |
| | |$9,609,369,900 |
| | |$9,609,369,900 |
| | |$2,018,167,879 |
| | |$7,591,202,021 |
| | |$2,061,000,000 |
| | |$9,652,202,021 |
| | | -$1,643,000,000 |
| | |$18,228,000,000 |
| | |$29,237,202,021 |
| | |- |
| | |2025 |
| | |$33,270,000,000 |
| | |$9,609,369,900 |
| | |$9,609,369,900 |
| | |$2,018,167,879 |
| | |$7,591,202,021 |
| | |$2,061,000,000 |
| | |$9,652,202,021 |
| | | -$1,643,000,000 |
| | |$18,228,000,000 |
| | |$29,237,202,021 |
| | |- |
| | |2026 |
| | |$33,270,000,000 |
| | |$9,609,369,900 |
| | |$9,609,369,900 |
| | |$2,018,167,879 |
| | |$7,591,202,021 |
| | |$2,061,000,000 |
| | |$9,652,202,021 |
| | | -$1,643,000,000 |
| | |$18,228,000,000 |
| | |$29,237,202,021 |
| | |} |
| | |
| | ==== Discount Cash Flows: ==== |
| | {| class="wikitable" |
| | !Year |
| | !FCF |
| | !PV Factor |
| | !Discounted FCF |
| | |- |
| | |2022 |
| | |$29,237,202,021 |
| | |0.9252 |
| | |$27,024,994,009 |
| | |- |
| | |2023 |
| | |$29,237,202,021 |
| | |0.8526 |
| | |$24,907,452,724 |
| | |- |
| | |2024 |
| | |$29,237,202,021 |
| | |0.7844 |
| | |$22,962,979,085 |
| | |- |
| | |2025 |
| | |$29,237,202,021 |
| | |0.7202 |
| | |$20,927,732,983 |
| | |- |
| | |2026 |
| | |$29,237,202,021 |
| | |0.6597 |
| | |$19,313,711,550 |
| | |- |
| | |TV |
| | |$493,077,739,961 |
| | |0.6597 |
| | |$325,224,847,288 |
| | |} |
| | |
| | ==== Calculation Results: ==== |
| | {| class="wikitable" |
| | !Calculation Results |
| | !Values |
| | |- |
| | |Equity Value |
| | |$311,028,340,331 |
| | |- |
| | |Per Share Value |
| | |$36.43 |
| | |- |
| | |Current Stock Value |
| | |$23.73 |
| | |- |
| | !Upside |
| | |'''53.5%''' |
| | |} |
|
| |
|
| == Valuation == | | == Valuation == |
Line 200: |
Line 331: |
| | | | | |
| |59.5 | | |59.5 |
| |}In our analysis of Airbus's valuation, we employed two distinct methods: | | |}In our analysis of UBS's valuation, we employed two distinct methods: |
| *'''Discounted Cashflow''': By employing the perpetuity growth approach, we ascertain that UBS Group AG's implied share price stands at '''$36.43'''. Consequently, this yields an approximated upside potential of '''53.5%'''.
| |
| *'''Trading Comps''': In light of our calculations based on the comps analysis, where the Price-to-Earnings (P/E) ratio indicates an estimated value of '''$15.93''', it's apparent that UBS Group AG's current stock value of $23.73 suggests a potential '''overvaluation''' in comparison to our projected valuation ranges.
| |
| ===What's the expected return of an Investment in the Company?===
| |
| Selecting the DCF valuation approach over the alternative methods, and considering an approximate upside potential of '''53.5%''' over a span of 5 years, projections based on Stockhub users' analysis suggest that an investment in UBS Group AG holds the potential for a significant return over the next five years, with an annual return of approximately 10.7%. To simplify, an initial £1,000 investment in UBS could potentially grow to around £1,535.00 in five years, taking into account the estimated upside.
| |
| | |
| When an investment attains its projected return of 53.5%, which corresponds to an annual return of about '''10.7%''' over the five-year period, it becomes a favorable choice for considering investment in the company.
| |
| | |
| == Monte-Carlo Simulations == | | == Monte-Carlo Simulations == |
|
| |
|
Line 582: |
Line 706: |
| |18,121,000 | | |18,121,000 |
| |} | | |} |
|
| |
| === Disocunted Cash Flow (DCF) ===
| |
| Outlined below is the Discounted Cash Flow (DCF) analysis for UBS Group AG. The computations have been performed using Bloomberg Terminal.
| |
| '''Assumptions:'''
| |
| * Revenue Growth Rate: 0%
| |
| * Operating Margin: 28.87%
| |
| * Tax Rate: 21%
| |
| * Discount Rate (WACC): 8.19%
| |
| * Terminal Growth Rate: 2%
| |
|
| |
| ==== Forecast Period: 5 years Calculate ====
| |
|
| |
| ==== Free Cash Flows (FCF) ====
| |
| {| class="wikitable"
| |
| !Year
| |
| !Revenue
| |
| !Operating Income
| |
| !EBT
| |
| !Taxes
| |
| !NOPAT
| |
| !Depreciation & Amortization
| |
| !Operating Cash Flow
| |
| !CAPEX
| |
| !Working Capital Changes
| |
| !Free Cash Flow
| |
| |-
| |
| |2022
| |
| |$33,270,000,000
| |
| |$9,609,369,900
| |
| |$9,609,369,900
| |
| |$2,018,167,879
| |
| |$7,591,202,021
| |
| |$2,061,000,000
| |
| |$9,652,202,021
| |
| | -$1,643,000,000
| |
| |$18,228,000,000
| |
| |$29,237,202,021
| |
| |-
| |
| |2023
| |
| |$33,270,000,000
| |
| |$9,609,369,900
| |
| |$9,609,369,900
| |
| |$2,018,167,879
| |
| |$7,591,202,021
| |
| |$2,061,000,000
| |
| |$9,652,202,021
| |
| | -$1,643,000,000
| |
| |$18,228,000,000
| |
| |$29,237,202,021
| |
| |-
| |
| |2024
| |
| |$33,270,000,000
| |
| |$9,609,369,900
| |
| |$9,609,369,900
| |
| |$2,018,167,879
| |
| |$7,591,202,021
| |
| |$2,061,000,000
| |
| |$9,652,202,021
| |
| | -$1,643,000,000
| |
| |$18,228,000,000
| |
| |$29,237,202,021
| |
| |-
| |
| |2025
| |
| |$33,270,000,000
| |
| |$9,609,369,900
| |
| |$9,609,369,900
| |
| |$2,018,167,879
| |
| |$7,591,202,021
| |
| |$2,061,000,000
| |
| |$9,652,202,021
| |
| | -$1,643,000,000
| |
| |$18,228,000,000
| |
| |$29,237,202,021
| |
| |-
| |
| |2026
| |
| |$33,270,000,000
| |
| |$9,609,369,900
| |
| |$9,609,369,900
| |
| |$2,018,167,879
| |
| |$7,591,202,021
| |
| |$2,061,000,000
| |
| |$9,652,202,021
| |
| | -$1,643,000,000
| |
| |$18,228,000,000
| |
| |$29,237,202,021
| |
| |}
| |
|
| |
| ==== Discount Cash Flows ====
| |
| {| class="wikitable"
| |
| !Year
| |
| !FCF
| |
| !PV Factor
| |
| !Discounted FCF
| |
| |-
| |
| |2022
| |
| |$29,237,202,021
| |
| |0.9252
| |
| |$27,024,994,009
| |
| |-
| |
| |2023
| |
| |$29,237,202,021
| |
| |0.8526
| |
| |$24,907,452,724
| |
| |-
| |
| |2024
| |
| |$29,237,202,021
| |
| |0.7844
| |
| |$22,962,979,085
| |
| |-
| |
| |2025
| |
| |$29,237,202,021
| |
| |0.7202
| |
| |$20,927,732,983
| |
| |-
| |
| |2026
| |
| |$29,237,202,021
| |
| |0.6597
| |
| |$19,313,711,550
| |
| |-
| |
| |TV
| |
| |$493,077,739,961
| |
| |0.6597
| |
| |$325,224,847,288
| |
| |}
| |
|
| |
| ==== Calculation Results ====
| |
| {| class="wikitable"
| |
| !Calculation Results
| |
| !Values
| |
| |-
| |
| |Equity Value
| |
| |$311,028,340,331
| |
| |-
| |
| |Per Share Value
| |
| |$36.43
| |
| |-
| |
| |Current Stock Value
| |
| |$23.73
| |
| |-
| |
| !Upside
| |
| |'''53.5%'''
| |
| |}
| |
|
| |
| ==== Sensitivity analysis ====
| |
| {| class="wikitable"
| |
| ! colspan="2" rowspan="2" |Sensitivity Analysis
| |
| ! colspan="7" |Perpetuity Growth Rate
| |
| |-
| |
| |0.20%
| |
| |0.70%
| |
| |1.20%
| |
| |1.70%
| |
| |2.20%
| |
| |2.70%
| |
| |3.20%
| |
| |-
| |
| ! rowspan="6" |WACC
| |
| |7.0%
| |
| |$33.77
| |
| |$34.60
| |
| |$35.46
| |
| |$36.37
| |
| |$37.33
| |
| |$38.34
| |
| |$39.41
| |
| |-
| |
| |7.5%
| |
| |$32.98
| |
| |$33.70
| |
| |$34.46
| |
| |$35.27
| |
| |$36.13
| |
| |$37.04
| |
| |$38.00
| |
| |-
| |
| |8.0%
| |
| |$32.24
| |
| |$32.83
| |
| |$33.47
| |
| |$34.16
| |
| |$34.89
| |
| |$35.68
| |
| |$36.51
| |
| |-
| |
| |8.5%
| |
| |$31.55
| |
| |$32.01
| |
| |$32.52
| |
| |$33.08
| |
| |$33.70
| |
| |$34.37
| |
| |$35.10
| |
| |-
| |
| |9.0%
| |
| |$30.90
| |
| |$31.26
| |
| |$31.67
| |
| |$32.12
| |
| |$32.63
| |
| |$33.18
| |
| |$33.79
| |
| |-
| |
| |9.5%
| |
| |$30.28
| |
| |$30.55
| |
| |$30.87
| |
| |$31.24
| |
| |$31.66
| |
| |$32.13
| |
| |$32.67
| |
| |}
| |
|
| |
| === Trading comparables (Comps) ===
| |
| {| class="wikitable"
| |
| !P/E Ratio
| |
| !Estimated EPS
| |
| !Estimated Share Price
| |
| |-
| |
| |Low (4.62x)
| |
| |1.96
| |
| |$9.06
| |
| |-
| |
| |Median (8.13x)
| |
| |1.96
| |
| |'''$15.93'''
| |
| |-
| |
| |Mean (8.79x)
| |
| |1.96
| |
| |$17.22
| |
| |-
| |
| |High (10.28x)
| |
| |1.96
| |
| |$20.14
| |
| |}
| |
|
| |
| == References ==
| |
| __INDEX__ | | __INDEX__ |
| <references /> | | <references /> |