Stock of the Day

January 11, 2022

UBS Group (UBS)

$33.48
-$0.05 (-0.1%)
Market Cap: $107.48B

About UBS Group

UBS Group AG provides financial advice and solutions to private, institutional, and corporate clients worldwide. It operates through five divisions: Global Wealth Management, Personal & Corporate Banking, Asset Management, Investment Bank, and Non-core and Legacy. The company offers investment advice, estate and wealth planning, investing, corporate and banking, and investment management, as well as mortgage, securities-based, and structured lending solutions. It also provides personal banking products and services, such as deposits, credit and debit cards, and online and mobile banking, as well as lending, investments, retirement, and wealth management services; and corporate and institutional solutions, including equity and debt capital markets, syndicated and structured credit, private placements, leasing, traditional financing, and transaction banking solutions for payment and cash management services, trade and export finance, and global custody solutions. In addition, the company offers equities, fixed income, hedge funds, real estate and private markets, indexed and alternative beta strategies, asset allocation and currency investment strategies, customized multi-asset solutions, advisory and fiduciary services, and multi-manager hedge fund solutions and advisory services. Further, it advises clients on strategic business opportunities and helps them raise capital to fund their activities; enables its clients to buy, sell, and finance securities on capital markets and to manage their risks and liquidity; distributes, trades in, finances, and clears cash equities and equity-linked products; structures, originates, and distributes new equity and equity-linked issues; and originates, distributes, manages risk, and provides liquidity in foreign exchange, rates, credit and precious metals. The company was formerly known as UBS AG and changed its name to UBS Group AG in December 2014. UBS Group AG was founded in 1862 and is headquartered in Zurich, Switzerland.

UBS Group Bull Case

Here are some ways that investors could benefit from investing in UBS Group AG:

  • UBS Group AG recently increased its annual dividend to $0.90 per share, significantly up from the previous $0.23, indicating strong financial health and a commitment to returning value to shareholders.
  • The stock is currently trading at $33.59, reflecting a solid market capitalization of approximately $107.72 billion, which suggests stability and investor confidence.
  • Analysts have a consensus rating of "Moderate Buy" for UBS Group AG, with several upgrades from firms like Deutsche Bank and BNP Paribas, indicating positive market sentiment and potential for growth.
  • UBS Group AG reported a revenue increase of 1.9% year-over-year, showcasing its ability to grow even in challenging market conditions, which is a positive sign for long-term investors.
  • The company operates through five divisions, providing a diversified range of financial services, which can help mitigate risks associated with market fluctuations.

UBS Group Bear Case

Investors should be bearish about investing in UBS Group AG for these reasons:

  • Despite the revenue growth, UBS Group AG reported earnings per share (EPS) of $0.23, which missed analysts' consensus estimates of $0.31, raising concerns about its profitability.
  • The company has a relatively high debt-to-equity ratio of 3.76, which may indicate higher financial risk, as it relies significantly on debt to finance its operations.
  • Market volatility can impact UBS Group AG's performance, especially given its exposure to various financial markets through its investment banking and asset management divisions.
  • Recent downgrades from analysts, such as the shift from a "buy" to a "hold" rating by StockNews.com, may signal caution among investors regarding the stock's short-term performance.
  • With a quick ratio of 1.05, UBS Group AG's liquidity position is tight, which could pose challenges in meeting short-term obligations if market conditions worsen.

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