In 2022, the banking sector continued to strengthen. Industry insiders believe that, on the whole, the current valuation of the banking sector is low, superimposed with the results of several companies, the overall performance of the sector will be better than expected, and banking stocks are expected to usher in valuation repair opportunities.
The sector generally rose
On January 20, bank stocks led the rise in all sectors of a shares, among which bank of Lanzhou rose the limit, Qilu Bank Co.Ltd(601665) , Ping An Bank Co.Ltd(000001) rose by more than 5%, and Bank Of Hangzhou Co.Ltd(600926) , China Merchants Bank Co.Ltd(600036) rose by more than 3%.
The bank stock market continues to heat up, which is not unexpected. In 2022, the banking sector changed the decline of the previous year and became a “dark horse” variety. Since 2022, bank ETF (512800) has risen by 6.54%, ranking first in the A-share industry. The 42 listed banks in A-Shares have all increased positively since 2022.
From the performance of individual stocks, excluding the newly listed bank of Lanzhou, as of the closing on January 20, Bank Of Chengdu Co.Ltd(601838) has increased by 22.92% this year, ranking first in the A-share listed bank sector. Seven stocks such as Bank Of Jiangsu Co.Ltd(600919) , Industrial Bank Co.Ltd(601166) , Bank Of Hangzhou Co.Ltd(600926) increased by more than 10%.
In addition to the encouraging rise in share prices, the performance growth of banks is also commendable. The performance of many banks in 2021 exceeded market expectations. The reporter of China Securities Journal noted that as of January 20, 15 listed banks had disclosed the performance express of 2021. Among them, taking the annual net profit attributable to the parent company as the index, China Merchants Bank Co.Ltd(600036) temporarily ranked first with 119.922 billion yuan, Industrial Bank Co.Ltd(601166) , China Citic Bank Corporation Limited(601998) , Ping An Bank Co.Ltd(000001) , Bank Of Jiangsu Co.Ltd(600919) , Bank Of Ningbo Co.Ltd(002142) net profit attributable to the parent company exceeded 10 billion yuan.
In terms of performance growth, the net profit attributable to the parent company in Bank Of Jiangsu Co.Ltd(600919) 2021 increased by 30.7% year-on-year, ranking first in the growth list, followed by Zhangjiagang bank, Bank Of Ningbo Co.Ltd(002142) , Ping An Bank Co.Ltd(000001) , with growth rates of 29.81%, 29.67% and 25.6% respectively. Except for Shanghai Rural Commercial Bank Co.Ltd(601825) , Bank Of Changsha Co.Ltd(601577) , China Everbright Bank Company Limited Co.Ltd(601818) , China Citic Bank Corporation Limited(601998) , the performance growth of the other 11 banks exceeded 20%.
In addition, it is worth mentioning that the performance express shows that the provision coverage of most banks has increased month on month, the risk offset ability has been enhanced, and the asset quality has continued to improve.
valuation is still low
Despite the recent strong performance of bank stocks, their overall valuation is still at a low level. Horizontally, up to now, the valuation of the banking sector is at the bottom level in all A-share industries. Vertically, the current average p / E ratio of the banking sector is 5.5 times, which is the bottom of nearly a decade.
For the current valuation of the banking sector, industry insiders generally believe that its margin of safety is high, and give a positive outlook on the future trend.
Zhongtai Securities Co.Ltd(600918) analyst Dai Zhifeng believes that the safety margin of the banking sector is relatively high, and the asset quality constructs the safety margin of banking stocks. It is expected that the asset quality of listed banks will be stable in the next few years.
Boc International (China) Co.Ltd(601696) analyst Lin Yuanyuan said that at present, the institutional positions and valuations of the banking sector are at historically low levels, and the dividend yield is increasing. With the continuous digestion of some factors by the market and the acceleration of stable growth policies such as wide credit at the beginning of the year, the market of the banking sector can be expected.
China Merchants Securities Co.Ltd(600999) Zhang Xia, chief strategist, believes that in the period of steady growth, the growth rate of social finance will significantly improve and accelerate the upward trend, resulting in a gradual recovery of investment. At this stage, the market style is dominant, and typical Pro cyclical undervalued industries such as banking sector will perform better.
Everbright Securities Company Limited(601788) Wang Yifeng’s team said in the research report that the bank index is expected to usher in a wave of rebound, and the upward slope will be relatively flat, but the bottom has been relatively clear.
