{"id":325316,"date":"2023-10-12T12:44:02","date_gmt":"2023-10-12T04:44:02","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=325316"},"modified":"2023-10-12T12:44:03","modified_gmt":"2023-10-12T04:44:03","slug":"stock-in-focus-security-bank-corp-secb-12-oct-2023-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-security-bank-corp-secb-12-oct-2023-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: Security Bank Corp. (SECB) – 12 Oct 2023 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>SECB<\/td><\/tr>
Company Name<\/strong><\/td>Security Bank Corp.<\/td><\/tr>
Broker<\/strong><\/td>RCBC Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>12 Oct 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 109.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Our target price (TP) for SECB at Php109.00 provides a huge upside of 43.6%, including our 2023 dividend yield forecast of 3.8%. <\/p>\n\n\n\n

We highlight that SECB has one of the lowest Price-to-Book ratios (PBR) among our coverage at 0.4x, below the average 2023 PBR of our coverage at 0.9x. Lastly, outside of the top three banks, SECB has the best asset quality in our coverage and would be the most defensive among Eastwest and Unionbank, which both have NPL ratios ranging between 5-7%.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

Building momentum<\/h3>\n\n\n\n

We expect Security Bank Corp. (SECB) to perform better in the 2nd half (2H) 2023 despite the drop in its 1st half (1H) 2023 net income. We think net interest margins may continue to expand due to loan re-pricing and modest loan growth at the high single-digits.<\/p>\n\n\n\n

Asset quality could further improve<\/h3>\n\n\n\n

Following the recent report that PH Banks\u2019 NPL ratios have improved to 3.42% in August, marking a new four-month low. We have more confidence that SECB\u2019s asset quality will also further improve in the 2H 2023. Recall that SECB\u2019s 2Q 2023 NPL ratio declined by 6bps q\/q to 3.06%, we believe that it could hit our 2.91% target for the 2023.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>