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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (44395)	9/20/2011 10:15:01 AM
From: Spekulatius	Read Replies (1) of 78644

re UBS is starting to look interesting here. My estimates is that UBS investment bank only generates 20-25% of their earnings, the remainder is wealth management/asset management and some swiss banking operations. There is talk about a radical restructuring of he investment bank, which means that it will be sold or shut down, imo. I assume they give away the investment bank for free, it certainly isn't worth much more <g>. I would peg their earning power ex investment bank at around 1.5$/share but that does not include potential buybacks due to the capital that is not needed to support the investment banking business and may be used for buybacks. My target would be ~10$/share - then you could buy an relatively pure swiss asset/wealth manager for 0.8x tangible book and 7x earnings. My guess is that this should work out OK when they slowly rebuild their tainted (imo) image and increase the earnings power of their remaining business. UBS wealth management is legendary and still has a strong brand, imo.

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