Banco Santander (SAN)

Fundamental analysis
Banco Santander is Spain’s largest bank and one of the largest banks in the Eurozone. It is still officially headquartered in Santander (located in the north of Spain), but its management centre is located in Madrid. The company belongs to the Eurostoxx 50 index and according to the European Central Bank it is a Systematically Important Bank, the highest bank importance rating in Europe. It is thus subject to direct supervision by the ECB.
The company has more than 165 million customers worldwide and more than 100 million active customers. For 2023, it added more than 5 million customers and more than 1 million active customers. The bank currently employs more than 212,000 employees worldwide.
The company’s main markets are Spain, Portugal, the UK, Poland, the US, Mexico, Chile, Argentina and Brazil.
SAN focuses on end-customer banking services, primarily retail. (Business to Customer).
The company is growing across segments, succeeding in acquiring new clients in the “Digital Customers” segment, a direction the bank sees as a major future sales channel. The company pays a regular dividend.
Results
SAN’s turnover and net income are growing.
Gross profit rose 13.1% to €57.6 million in the latest quarter. Net profit for the group was €11 million (+17.7%).
Interest income rose rapidly. For Q4, the increase was 15.8% to 43.2 million Euro.
Technical analysis
The PE is 4.79.
SAN stock is very cheap, around 4 Euro/USD apiece, depending on which exchange you choose to trade. On the NYSE, the number of shares traded is around 3 million a day.
The moving averages are in an uptrend, however, in November they almost crossed and turned down. The spread between the moving averages is quite small, this indicates the weakening strength of the uptrend.
The RSI is in the neutral zone for a very long time, unlike many of the previous stocks analyzed. This indicates that the growth of the stock is very gradual, which does not drive the RSI to the limits.
Resistance is holding the stock quite well. The current strong boundary is at $4.09, around which the price is now oscillating.
Conclusion
Bank Santander is focused on retail clients. Their deposited money has yielded very high interest income. Furthermore, the bank has been able to expand its client portfolio solidly and increase its income. The bank is building on the fact that growth is steady and organic, and therefore sustainable for a long time. The long-term results prove this, the growth of the stock does not. There is therefore potential for further, gradual growth. The low price helps the stock’s affordability.
On the other hand, the moving averages are converging, with resistance keeping the price around the $4.09 mark. This in turn may help the stock to decline.
Sources
https://seekingalpha.com/symbol/SAN/income-statement
https://finance.yahoo.com/quote/SAN/financials
https://www.santander.com/en/shareholders-and-investors/financial-and-economic-information#quarterly-results
https://www.santanderaccionistaseinversores.com/4T23/eng/index.php#resultados
https://www.santander.com/content/dam/santander-com/en/documentos/presentacion-institucional/2023/pi-2023-institutional-presentation-en.pdf
https://www.santander.com/en/about-us/our-business-model
https://www.santander.com/en/about-us/key-facts-and-figures
https://en.wikipedia.org/wiki/Banco_Santander
https://economy-finance.ec.europa.eu/document/download/a78883ab-6fc1-403d-8693-f2eeaae3e5df_en?filename=bcs_2024_01_statistical_annex_en.pdf