Sasfin, Stefanutti Stocks
WE RECOMMENDED A ‘ buy’ on Sasfin in both 2013 and 2014, and back then i t was trading on a price-to- book ratio of around 1.1 times, which offered some serious value. The market has now caught on, pushing the price higher and that price- to- book ratio i s now around 1 . 5 times – still offering value, but not nearly as cheap as it has been in recent years.
We’re seeing increased interest in local financial stocks and this has pushed t he entire sector higher resulting in most financial stocks becoming expensive to varying degrees, while Sasfin still offers some value and is on the lowest historic P/ E ( just over 10 times), and has a good dividend yield of just over 3%.
Recent results did not shoot the lights out, but were certainly ve r y so l i d wi t h HE P S an d dividends both up 15%, and costs only up some 9%.
Impairments took a hit, but are still below 1%.
Its new transactional banking division was l aunched l ast year and promises great synergies for cross-selling as Sasfin has tr a di t i onal l y se e n it s cl i e nt s transact with other institutions.
We’re not likely to see the great share price gains we have in r ecent years , but i t st i l l has potential for the price to outperform its peers.