Will UBS stock hit $23 following the strong underlying operating profit report?

By:
on Nov 7, 2023
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  • UBS reported a $255 million pre-tax loss and an underlying operating profit before tax of $844 million.
  • The bank has however reaped billion in asset inflows in Q3 after announcing the Credit Suisse merger.
  • The UBS stock price has gained 27% since the beginning of the year.

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UBS Group AG (NYSE:UBS), the Swiss banking giant, saw its shares soar following a robust third-quarter report, exceeding expectations with a strong underlying operating profit before tax of $844 million. The UBS stock jumped by 4% on Teusday.

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The UBS Group AG’s stock price has been a subject of interest and speculation in the financial markets following its impressive underlying operating profit report despite reporting a pre-tax loss of $255 million in Q3. The future price prediction for UBS stock is now in the spotlight.

Strong operating profit boosts UBS shares

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In a recent financial report, the UBS Group AG demonstrated impressive strength in its underlying operating profit before tax, reaching $844 million. This performance far exceeded consensus expectations and is the main factor behind the current 4% increase in UBS share price.

However, it’s crucial to note that this positive news was somewhat tempered by expenses related to the integration of its fallen rival, Credit Suisse, which led to a bigger-than-expected net loss attributable to shareholders of $785 million for the third quarter after a strong second quarter.

Future price predictions for UBS stock

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Analysts have been closely monitoring the performance of UBS stock and providing future price predictions based on these financial results. According to recent data, the average 12-month price target for UBS is $30.93.

The highest price estimate for UBS Group (UBS) stock price estimate stands at $38.97, while the lowest estimate is $19.49.

While the stock experienced a surge following the acquisition of Credit Suisse in June, reaching its highest point since late 2008, it has since moderated but remains up more than 27% for the year.

UBS stock price chart

Going by the above chart, it is evident that both MACD and moving average crossover on the 30-minutes timeframe chart confirms that the UBS share price is expected to continue with the current bullish trend. Most importantly, the MACD crossover just occurred below the zero line signalling we could be at the beginning of a bull trend rather than the end.

UBS is currently in the process of fully integrating Credit Suisse’s Swiss banking unit, which is a key profit centre for the company, and is expected to make substantial cost savings by 2026 as part of the integration process.

UBS has reported net new deposits of $33 billion across its Global Wealth Management and Personal and Corporate Banking (P&C) divisions, with $22 billion coming from Credit Suisse clients. This influx of deposits, along with positive deposit inflows for P&C in September, following the decision to integrate the domestic bank, has further contributed to UBS’s strong position in the market.

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