DBS' record-high valuation to be tested tomorrow
📢DBS will be the first Singapore bank to report second quarter earnings before market tomorrow, followed by OCBC and UOB a day after (also pre-market)
🔥 $DBS(D05.SI)$ has risen more than 32% this year to a record high of $75 just last week, leading the stock to trade at 18 times forward earnings, which is twice its five-year average
🔎Investors will be awaiting tomorrow's results to see if DBS' current valuations are justified, and will likely focus on wealth fee and momentum, as well as credit costs
The biggest swing factor is fees and lower credit charges, which could drive earnings higher, according to Jayden Vatarakis, Macquarie's Head of Asean
Equities as quoted by Bloomberg in an article released this morning
DBS is expected to report adjusted 2Q26 net income of $2.88 billion, according to data compiled by Bloomberg
Revenue will likely remain steady at $5.95 billion, which Bloomberg Intelligence said will be supported by fees from servicing high net worth clients
Investors keen to take a position in DBS shares either ahead of or post earnings can consider the below trending call and/or put warrants
✳DBS call $DBS MB eCW270226(IJMW.SI)$ (https://warrants.com.sg/tools/livematrix/IJMW): since listing on 21 July, the call warrant is 13.5% higher to $0.135 this morning as of 1020AM, 5.2 times more than DBS' 2.6 increase over the same period
✴DBS put $DBS MB ePW270226(V1RW.SI)$
(https://warrants.com.sg/tools/livematrix/V1RW): down 20.2% to $0.095 over the same period, and may be used by investors who believe that DBS shares may head lower following results
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