JPMorgan analyst Delphine Lee has revised the price target for ING Groep (ING, Financial), reducing it marginally from EUR 21.90 to EUR 21.80. Despite this slight adjustment, the analyst continues to uphold an Overweight rating on ING's shares, indicating a positive outlook on the firm's future performance.
The decision reflects ongoing evaluations of the company's financial health and market potential, suggesting that ING Groep remains a favorable investment despite the minor price target decrease. Investors are encouraged to consider the Overweight rating as a sign of confidence in the company's sustained growth prospects.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 4 analysts, the average target price for ING Groep NV (ING, Financial) is $21.05 with a high estimate of $23.33 and a low estimate of $17.30. The average target implies an upside of 6.95% from the current price of $19.69. More detailed estimate data can be found on the ING Groep NV (ING) Forecast page.
Based on the consensus recommendation from 4 brokerage firms, ING Groep NV's (ING, Financial) average brokerage recommendation is currently 2.8, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for ING Groep NV (ING, Financial) in one year is $16.88, suggesting a downside of 14.25% from the current price of $19.685. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the ING Groep NV (ING) Summary page.
ING Key Business Developments
Release Date: February 06, 2025
- Mobile Primary Business Customers Growth: Increased by 1.1 million in 2024, with 430,000 added in Q4.
- Net Core Lending Growth: Retail Banking grew by EUR26 billion in 2024, with EUR7.2 billion in Q4.
- Net Deposit Growth: Total customer balance growth of 6% in 2024.
- Sustainable Deals Volume: EUR130 billion mobilized in 2024, a 13% increase from 2023.
- Branch Network Rationalization: Reduced to just over 600 globally from almost 800 in 2023.
- Net Interest Income: Supported by volume growth in lending and liabilities.
- Fee Income Growth: Increased by over 11% year-on-year.
- Return on Equity: 13% in 2024.
- Shareholder Yield: Above 15% for the second consecutive year.
- Share Buyback: EUR2 billion ongoing, with an additional EUR500 million cash payment in January.
- Final Cash Dividend: EUR0.71 per share for 2024.
- Netherlands Income: Around EUR5 billion with profit before tax close to EUR3 billion.
- Russia Business Sale Impact: Estimated negative impact of EUR700 million on P&L.
- Core Deposit Growth: Increased by over EUR16 billion in Q4.
- Fee Growth: 14% year-on-year increase.
- Total Expenses: Increased by 4.8% in 2024.
- Risk Cost: EUR299 million in Q4, 18 basis points of average customer lending.
- Core Tier 1 Ratio: Decreased slightly due to higher risk-weighted assets.
- 2025 Outlook: Total income expected to remain strong with 5%-10% fee income growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- ING Groep NV (ING, Financial) achieved outstanding commercial growth in 2024, with a significant increase in mobile primary business customers and a record net core lending growth of EUR26 billion.
- The company reported strong net interest income supported by volume growth in both lending and liabilities, despite margin pressure from decreasing rates.
- Fee income grew by over 11% year-on-year, driven by an increase in the number of clients and diversification of the income base.
- ING Groep NV (ING) maintained a strong capital generation, with a return on equity of 13% and a shareholder yield above 15% for the second consecutive year.
- The company made significant progress in sustainability, mobilizing EUR130 billion in sustainable deals, surpassing its previous target for 2025.
Negative Points
- The sale of the onshore business in Russia is expected to have a negative impact of around EUR700 million on the P&L and around 5 basis points on the CET1 ratio.
- The liability margin decreased due to lower replicating income and additional lower margin volumes attracted in Wholesale Banking.
- Total expenses increased by 4.8% in 2024, driven by inflationary pressures on staff expenses and higher VAT following a ruling in the Netherlands.
- Risk costs amounted to EUR299 million in the fourth quarter, with additions to Stage 3 provisions largely due to new and existing files in Wholesale Banking.
- The company faces challenges in maintaining a strong liability NII in a lower rate environment, with expectations of a liability margin around 100 basis points in 2025.
