BEN delivered an excellent result which saw the bank catapult over 11% higher, a huge move for the sector. The headline profit was a 27% beat on consensus expectations plus the board announced an interim dividend of 23.5c (v 15c expected) plus they expanded margins. This was a really strong result relative to downbeat expectations plus it’s another sign of a resurgent Banking Sector.
As subscribers know MM recently made one tweak around our banking exposure going up the risk curve buying Virgin UK (VUK) however looking at the relative performers in the space recently with CBA underperforming the cheaper / lower quality banks, it will be interesting to see if this continues after CBA trades ex-dividend today, if so we might join in the party! A close to 5% short position could help BEN’s upside momentum be maintained.
Depending how CBA trades ex-dividend, we are considering a switch into Westpac (WBC), although are bullish BEN in the regionals.
MM is bullish BEN although prefer WBC on valuation
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