Sabadell Takes Advantage of BBVA

Sabadell Takes Advantage of BBVA

Banco Sabadell manages to recover from the initial impact caused by the breakdown of the negotiations for its merger with BBVA. The announcement, on November 27, led the Catalan entity to register the largest drop in the IBEX 35 since the outbreak of the pandemic in March .

In that session, the price of Sabadell shares fell by 13.26% to close at 0.35 euros per share. It thus put an end to the bullish rally that it had been registering in the month and that had brought its price to 0.42 euros, the highest since April.

On Monday 30, the Catalan bank again registered a fall of 6.38%. Its shares closed at 0.32 euros after signing the biggest drop of the IBEX in the day and the third of the whole of the Spanish stock market.

Sabadell, December in green
Since then, Sabadell has chained six consecutive sessions, all of December, in green, which raise the price of their titles to 0.37 euros. The biggest boost, that of day 1, was 6.05%, which was followed by 5.50% more on Tuesday and 2.06% last Thursday.

Between Friday and this Monday’s session it barely rose by 0.36%. This Tuesday, the price of the Sabadell shoots up above 1.80%, leading the increases in the IBEX 35. Since the end of negotiations , the Catalan bank’s price has risen by 9.72%, even above the increase registered by BBVA.

BBVA slows down its rally
The Basque entity, for its part, this week slows the progress registered in the previous one. This Monday registered a drop of 2.50% that continues this Tuesday, although more moderate, from 0.59% to 4.19 euros. Since the announcement of its break, its prices have risen by more than 7%.

Better forecasts
Although progress is less, the Basque entity obtains better forecasts according to the Bloomberg panel of analysts. In the buy recommendation, BBVA has 11 positions compared to 1 for Sabadell.

Caixabank or Barclays were some of the analysts who revised their positions on the 27th, raising BBVA to a price between 4 and 4.30 euros and lowering Sabadell to a figure between 0.30 and 0.40 euros.

Following the Bloomberg consensus, the target price for the Basque bank is 3.84 euros for the next 12 months and 0.38 euros for Sabadell, in a scenario in which the European Central Bank expects banks to continue showing levels low profitability.

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