Joey Cipres, research analyst at AP Securities, said the banking giant's 2024 results validated their projections last year, when BDO was included among their top banking picks.
“We expect BDO to sustain earnings growth this year, with a greater portion driven by loan volume growth rather than margins, as the BSP continues with its rate cut cycle,” Cipres told InsiderPH.
AP Securities maintains a “Buy” rating on BDO, with a target price of P180.18 per share, implying a 28 percent upside from its current P140.40 level.
Risks and opportunities
“The BSP's slower pace of easing would delay the margin erosion that we expect, but likewise delay the improvement in demand for loans,” Cipres said.
“At the same time, the BSP's recent RRR [reserve requirement ratio] cut would provide excess liquidity to the banks and we could see them vying for borrowers' attention in an effort to deploy their excess funds. This could lead to more pricing competition among the banks this year,” he added
