Many investment banking firms have upwardly revised their price projections related to Erste Bank shares in the wake of the positive financial results announced by the Austrian group last week. As a result, the most positive estimates exceeded 65 euros per share for the end of 2007.
Bear Stearns, for example, has reviewed its target price to 65.30 euros per share, including Erste in the category of overperforming shares. A similar upgrade was operated by Societe Generale, which raised its price target from 60 euros to 65 euros.
However, the most bullish forecast comes from Deutsche Bank, which considers the price of an Erste share is likely to increase to as much as 70 euros this year, while the previous target price pointed to 63.50 euros. More conservative forecasts were made by Fox-Pitt analysts who foresee a growth potential of up to 62 euros. In turn, Raiffeisen Centrobank raised the price target from 56 euros to 63 euros and recommends investors to buy Erste shares.
Dresdner Kleinwort also issued a "buy" recommendation for the Austrian bank's shares in the wake of the bank's announcement of the financial results it derived in 2006.
Last Friday, an Erste share was priced at 57.20 euros on the Vienna stock exchange, up 1.24 percentage points compared with the previous session close, but considerably below the all-time high of around 61 euros the stock had reached back in January.
Erste Bank, Austria's second largest bank, reported its net income increased by 30.1 percent in 2006, from 716.7 million euros to 932.2 million euros last year, a record high for Erste Bank Group.
This income growth was mainly triggered by the solid performance registered by the subsidiaries of the group in Central and Eastern Europe.
BCR's contribution to Erste's net profit amounted to 27.4m euros.
Erste Bank's operating income increased b
