DNB ASA (DNBBY) AI Stock Analysis

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DNB ASA

(OTC:DNBBY)

75Outperform

DNB ASA's overall score reflects strong financial performance with robust revenue growth and profitability, despite concerns about negative cash flows. The technical analysis indicates positive momentum, while the valuation suggests the stock is undervalued. The recent earnings call supports a positive outlook with strong performance metrics and guidance. However, challenges such as inflation and regulatory requirements pose risks.

DNB ASA (DNBBY) vs. S&P 500 (SPY)

Market Cap

$39.30B

Dividend Yield4.05%

Average Volume (3M)5.36K

Price to Earnings (P/E)9.6

Beta (1Y)0.59

Revenue Growth17.01%

EPS Growth16.07%

CountryUS

Employees11,188

SectorFinancial

Sector Strength85

IndustryBanks - Regional

Share Statistics

EPS (TTM)0.68

Shares Outstanding1,492,530,300

10 Day Avg. Volume2,975

30 Day Avg. Volume5,355

Financial Highlights & Ratios

PEG Ratio4.58

Price to Book (P/B)1.39

Price to Sales (P/S)0.00

P/FCF Ratio-11.19

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

DNB ASA Business Overview & Revenue Model

Company DescriptionDNB ASA (DNBBY) is the largest financial services group in Norway, providing a wide range of financial products and services to personal and corporate customers. It operates primarily in the banking sector, offering services such as loans, savings, advisory, insurance, and asset management. DNB is known for its robust digital banking platforms and has a significant presence in the Nordic region, as well as international operations that support Norwegian companies abroad.

How the Company Makes MoneyDNB ASA generates revenue through various streams, primarily from interest income on loans and credit extended to personal and corporate customers. The bank also earns income from fees and commissions associated with its wealth management, asset management, and investment banking services. Additionally, DNB generates revenue through its insurance products, including life and non-life insurance offerings. Key partnerships with international financial institutions and a strong focus on digital banking solutions further contribute to its revenue growth. Foreign exchange services and treasury operations also play a role in the company's earnings.

DNB ASA Financial Statement Overview

Summary

DNB ASA demonstrates strong revenue growth and profitability with increasing revenue and net profit margins. However, the lack of EBIT and EBITDA data for 2024 and negative cash flows present potential risks. The balance sheet shows financial stability with zero debt and a strong equity position.

Income Statement

Positive

DNB ASA shows a strong revenue growth trajectory with a notable increase in total revenue from NOK 79.06 billion in 2023 to NOK 84.82 billion in 2024, marking a revenue growth rate of approximately 7.79%. The gross profit margin remains consistently high as total revenue equals gross profit. However, the lack of reported EBIT and EBITDA for 2024 raises concerns about operational efficiency and transparency in this period. The net profit margin improved significantly from 49.93% in 2023 to 53.95% in 2024, indicating strong profitability.

Balance Sheet

Positive

The company's balance sheet is robust, with a solid stockholders' equity to total assets ratio of 7.83% in 2024, indicating a strong equity base. The company has no total debt reported in 2024, which significantly reduces financial risk. The return on equity (ROE) improved to 16.17% in 2024, showcasing enhanced profitability and efficient use of equity. Overall, the balance sheet reflects financial stability with a strong equity position and minimal financial leverage.

Cash Flow

Neutral

DNB ASA's cash flow statement indicates challenges in cash generation, with a negative operating cash flow of NOK -156.44 billion in 2024, significantly impacting free cash flow, which is also negative at NOK -159.12 billion. This represents a substantial deterioration compared to previous years, raising concerns about liquidity and cash management. The operating cash flow to net income ratio is negative, suggesting that the company's operations are not generating sufficient cash relative to its net income.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
116.91B	84.82B	79.06B	65.50B	55.39B	56.00B
	Gross Profit
85.77B	84.82B	81.25B	65.50B	55.39B	56.00B
	EBIT
55.93B	54.44B	57.43B	71.75B	32.79B	24.08B
	EBITDA
14.50B	0.00	0.00	0.00	0.00	0.00
	Net Income Common Stockholders
46.41B	45.77B	39.48B	33.36B	25.33B	19.85B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
545.44B	179.96B	335.58B	309.99B	400.72B	373.01B
	Total Assets
4.03T	3.61T	3.44T	3.24T	2.92T	2.92T
	Total Debt
999.81B	1.01T	952.37B	838.67B	778.50B	824.50B
	Net Debt
454.37B	866.48B	620.96B	528.69B	481.77B	540.98B
	Total Liabilities
3.74T	3.33T	3.17T	2.98T	2.68T	2.67T
	Stockholders Equity
292.26B	283.11B	269.13B	258.87B	243.65B	248.28B
Cash Flow		Free Cash Flow
-36.28B	-159.12B	43.00M	32.80B	37.10B	80.74B
	Operating Cash Flow
-33.81B	-156.44B	4.12B	36.31B	41.59B	84.57B
	Investing Cash Flow
-11.47B	-880.00M	-1.76B	-7.65B	-4.39B	-4.72B
	Financing Cash Flow
-25.01B	-29.57B	14.18B	34.25B	-15.74B	-102.23B

DNB ASA Technical Analysis

Technical Analysis Sentiment

Positive

Last Price26.33

Price Trends

50DMA

25.13

Positive

100DMA

23.26

Positive

200DMA

21.91

Positive

Market Momentum

MACD

0.33

Negative

RSI

61.19

Neutral

STOCH

68.94

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DNBBY, the sentiment is Positive. The current price of 26.33 is above the 20-day moving average (MA) of 25.49, above the 50-day MA of 25.13, and above the 200-day MA of 21.91, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 61.19 is Neutral, neither overbought nor oversold. The STOCH value of 68.94 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DNBBY.

DNB ASA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ITUB	76 Outperform	$67.90B	9.56	20.65%	5.17%	-7.01%	15.18%
LYG	76 Outperform	$59.76B	12.46	8.73%	3.95%	-2.65%	-14.84%
DNBBY	75 Outperform	$39.30B	9.58	16.57%	4.05%	17.01%	16.07%
MTB	74 Outperform	$30.14B	12.58	9.39%	2.88%	1.20%	1.12%
FITB	69 Neutral	$26.46B	12.59	11.71%	3.68%	5.75%	0.68%
Sector *	64 Neutral	$12.82B	9.83	7.68%	17000.34%	12.38%	-5.56%
TFC	55 Neutral	$54.21B	12.20	0.10%	5.02%	-27.31%	―

* Financial Sector Average

Performance Comparison

DNBBY

DNB ASA

26.33

7.29

38.29%

TFC

Truist Financial

41.40

4.21

11.32%

FITB

Fifth Third Bancorp

39.51

3.11

8.54%

ITUB

Itau Unibanco

6.81

1.32

24.04%

LYG

Lloyds Banking

4.10

1.40

51.85%

MTB

M&T Bank

187.34

39.59

26.80%

DNB ASA Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: 3.70%|

Next Earnings Date:Jul 11, 2025

Earnings Call Sentiment Positive

The earnings call showcases a strong financial performance with significant growth in fees and a robust capital position. However, challenges such as global trade tensions and specific impairments present risks. The overall sentiment is leaning towards positive due to the strong core performance and strategic positioning with the Carnegie acquisition.

Q1-2025 Updates

Positive Updates

Strong Performance Across the Board

DNB reported a strong performance with a return on equity of 15.9%. Net interest income (NII) was down 1.8% from the fourth quarter but up 5.7% from the first quarter of 2024. The company also saw a 29.5% increase in net commission and fees, with a record high quarter for commission and fees.

Inclusion of Carnegie

The inclusion of Carnegie as of March has positioned DNB well for future fee-related income. The merger is expected to create a Nordic powerhouse in investment banking and wealth management.

Robust Capital Position

DNB maintains a robust capital position with a core Tier 1 capital ratio of 18.5%, even after accounting for the acquisition of Carnegie.

Positive Economic Outlook

The Norwegian economy remains robust with low unemployment levels around 2% and a moderate growth outlook. The Central Bank is expected to cut the policy rate twice this year to end at 4% by year-end.

Negative Updates

NII Impacted by Rate Changes

Net interest income was down 1.8% from the fourth quarter, impacted by profitable growth in loans and deposits but offset by fewer interest rate days.

Exposure to Global Trade Tensions

The company faces uncertainty due to global trade tensions and tariff risks, particularly affecting sectors like energy and shipping.

Impairment Provisions

DNB took impairment provisions of NOK 410 million in the quarter, with some stemming from the legacy portfolio in Poland.

Limited Loan Growth in Large Corporates

Loan growth in the large corporate area was fairly stable, with an uptick of only 0.5% currency adjusted, and negative 0.3% if not adjusted for currency.

Company Guidance

During DNB's Analyst Call for the first quarter of 2025, the bank provided comprehensive guidance detailing its financial performance and strategic outlook. The Norwegian economy remained stable, with low unemployment at approximately 2% and the Central Bank maintaining a policy rate of 4.5%, expected to decrease to 4% by year-end. DNB reported a return on equity of 15.9%, with net interest income (NII) down 1.8% from the previous quarter but up 5.7% from the same period in 2024, influenced by growth in loans and deposits. Net commission and fees surged by 29.5% year-on-year, driven significantly by the inclusion of Carnegie, marking a record high for the quarter. Loan growth was modest, with personal customers increasing by 0.8% and small and medium-sized enterprises by 0.5%, while large corporate volumes remained stable. The bank's capital position remained robust with a Core Tier 1 capital ratio at 18.5%, and it announced plans to apply for a 1% share buyback. Additionally, impairment provisions totaled NOK 410 million, and the bank received authorization to buy back up to 3.5% of outstanding shares.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.