UBS Just Got A Monster Bargain - And Investors Can, Too
Summary
- UBS Group AG made an exceptional deal buying Credit Suisse Group AG for about $3.25 billion.
- In order to support the deal, Swiss authorities orchestrated exceptional support, providing financing of up to CHF 100 billion and risk protection of CHF 25 billion.
- Following the UBS / Credit Suisse merger, UBS' CEO Ralph Hamers vowed that the bank's strategy will remain unchanged -- but scaled.
- UBS management expects that the deal will materialize a 74% increase in UBS' tangible book value per share at Day-1.
- While it is too early for me to assign a new target price to UBS stock, I am confident to already argue that the new TP will be higher than $34.46 estimated previously.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of UBS either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
not financial advise, market commentary only
Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.