GDR Tinkoff renewed their all-time high. As a result, the company’s capitalization approached $ 16 billion. Since the spring of last year, Tinkoff shares have been in a stable upward trend, having increased by 7 times since then. At the same time, there is no obvious news that could contribute to such an increase in quotations.
Why are the Tinkoff GDRs growing, and is it worth buying them now? The Fortrader issue was commented on by Nikolai Dudchenko, an independent financial analyst.
– In January of this year, we already considered Tinkoff shares from the point of view of their growth prospects. Our forecast was optimistic and we were not mistaken. Let’s now return to the analysis of the company’s key fundamental indicators and determine how much these stocks are now suitable for investment.
I usually recommend starting your company research at the level of its “indebtedness“, I.e. share of debt in the company’s assets. According to the latest published reports for 2020, Tinkoff Bank has this ratio of 85.2%. For the banking business, this is a rather low value (for example, VTB’s share of debt in assets is 90.5%). An important factor in assessing banking risks is “delay“(NPL). At Tinkoff Bank, this figure is kept at 9.7%. For comparison, Sberbank’s figure is 4.3%; VTB has 5.7%. Conclusion: according to this metric, TCSG is still inferior to the largest market players.
Next, we estimate capitalization the company or, more simply, the market value of the business. At the moment, the capitalization of Tinkoff is about 1.1 trillion rubles. Moreover, the value of the group’s assets exceeds 859 billion. It can be concluded that the market value of the business is 1.2 times the value of the company’s assets.
One of the key performance indicators of any company is the assessment the growth rate of its net profit… In the case of TCS for 2020, the company’s net profit amounted to 44.2 billion rubles, an increase compared to 2019 by 22.4%. For 2018-2019 net profit increased by 33%.
Over the past few years, the group has been able to significantly increase its loan portfolio from 102 billion in 2016 to 376.5 billion in 2020. The company’s deposits have also more than quadrupled over the past 5 years.
Return on equity Tinkoff for 2020 was 40.6%, ROA 6.4%. It can be concluded that the company’s management is working quite effectively.
Key price P / E multiplier is 25.4. Again, let’s see what the competitors have: Sberbank has 9.31; VTB has 15.5. It must be admitted that for this key indicator, as in the case of the NPL, TCSG again loses. It is quite possible that the share price is significantly overpriced.
Now let’s take a look at Tinkoff shares from a technical point of view.
What immediately catches your eye is the explosive growth in capitalization. The share price is currently in a steadily growing price channel with the boundaries of 4900 – 6300 rubles. Here, however, attention is drawn to rather alarming “bells” that indicate that the price may turn around and correct in the near future.
- Quite a strong deviation of the price from its moving average.
- Divergences in the RSI and MACD indicators with the direction of price movement – a decrease in indicators against the background of a price increase.
The first target of a possible correction will, of course, be the lower border of the price channel, i.e. the level of 4900. Further, it is possible to move to the nearest local maximum – the level of 4800 rubles. for the paper.
conclusions: I don’t think now is the right time to buy Tinkoff Bank shares. It is worth thinking about including securities in the portfolio after the stocks have corrected and then, quite possibly, the price will become more attractive for opening longs.