Analysts lower DBS target prices after Q3 earnings dip and cautious 2027 outlook
Following a 5% drop in third-quarter profit, several analysts reduced their price targets for DBS, citing a more cautious earnings outlook for 2027 despite the bank's resilient underlying performance.
Several analysts cut their target price for DBS after the bank reported a 5% decline in third-quarter net profit to S$2.81 billion, driven mainly by weaker markets trading income. Citi lowered its target to S$80.30 from S$86.60, CGS International to S$78.90 from S$79.50, and Maybank Investment Banking Group to S$80.52 from S$85.86. Jefferies, Macquarie and RHB also reduced their targets, ranging from S$76.40 to S$88.
The revisions follow DBS's guidance for 2027, which projects total income growth in the mid-single-digit range, net interest income growth in the mid-single digits, and non-interest income growth in the high-single-digit to double-digit range, depending on market performance. Citi analyst Tan Yong Hong said the guidance implied a 2% downgrade to earnings per share versus market expectations. Macquarie's Jayden Vantarakis described the outlook as “cautious” amid market volatility.
Despite the price correction, Jefferies analysts Joanna Cheah and Ang Wei Han noted that the share price dip could present an entry point, maintaining a “buy” call on the stock. Net interest income rose 4% to S$3.71 billion in Q3, offsetting a rates headwind. OCBC's Carmen Lee upgraded DBS to “buy” from “hold,” keeping her fair-value estimate at S$78 and citing the bank’s alignment with the Singapore economy.
Maybank's Thilan Wickramasinghe highlighted that DBS has used only S$400 million of its S$3 billion share-buyback mandate and expects the bank’s deployment of artificial-intelligence agents to enhance customer engagement and operational efficiency. DBS shares closed 2.1% lower at S$69.72 on Friday.