Bank of Cyprus is ‘healthy investment,’ say analysts, with 12.28% revenue growth forecast

Bank of Cyprus Holdings has been deemed a healthy investment opportunity, stock analysts at Simply Wall St have reported this week.

Analysts expect revenue to grow at a rate of 12.28 per cent per year; in the past, it has experienced a growth rate of 20.5 per cent over the last five years

The report makes note of the company’s healthy balance sheet, explaining that this reflects a state of good financial health for Bank of Cyprus.

The balance sheet is broken down into long term and other assets, cash and short term investments, accounts payable, equity, other liabilities and debt. Simply Wall St rates all categories as solid.

The bank’s asset level is deemed to be acceptable with the bank scoring positively on a number of metrics.

Firstly, the bank’s assets to equity ratio is deemed to be fair. What this means is that the company does not use an excessive amount of debt to fund its operations when compared to using wholly-owned funds to do the same.

Moreover, the bank’s 80 per cent of liabilities are deemed of being low risk, which bodes well for the bank as it decreases the possibility of a sudden drop in value.

Further, the bank has reduced its non-performing loans (NPL) by €13.3 billion or 89 per cent.

Analysts also say that the bank’s loans-to-asset ratio is appropriate (45 per cent), as is the case with the bank’s loans-to-deposit ratio (62 per cent).

Deposits remained practically unaltered when contrasted with the last quarter of 2020, totalling €16.3 billion.

Additionally, liquidity also remains strong and the bank continues to operate with a significant liquidity surplus nearing €5 billion.

Simply Wall St also delved into the bank’s ownership, breaking it down to the various types of investor groups who have shares in the Bank of Cyprus.

Individual insiders make up 0.02 per cent of the ownership, hedge funds make up 5.4 per cent, institutions make up 18.5 per cent, private companies make up 19.1 per cent, while the general public makes up the remaining 57 per cent.

The company views the sizable percentage of institutional investors in a mostly positive light, noting that it reflects positively on the bank’s credibility.

“Institutional investors have a fair amount of stake in Bank of Cyprus Holdings. This can indicate that the company has a certain degree of credibility in the investment community,” the company said.