UniCredit is one of the largest and most exciting stocks in the Eurozone Stock Market. Find out more about this multi-billion dollar group and invest in it with TradeFW today!
Founded in 1998, UniCredit is an Italian global banking and financial services company, formerly known as Unicredito Italiano. Led by Chairman Giuseppe Vita and CEO Jean Pierre Mustier, the company is headquartered in Milan, Italy; and it operates through the following segments: Commercial Banking Italy, Commercial Banking Austria, Commercial Banking Germany, Corporate & Investment Banking, Central and Eastern Europe, Fineco, Group Corporate Centre, and other Non-Core segments.
UniCredit offers retail, private & corporate banking services, as well as trading, credit, and investment services; structured financing; insurance, hedging and treasury solutions, and transactional & credit services. The company expands over 50 markets and 18 countries, including Germany, Bulgaria, Romania, the Czech Republic, and Russia.
UniCredit is publicly listed and traded on the Italian Stock Exchange (BIT: UCG), the Frankfurt Stock Exchange (FWB: CRI), and the Warsaw Stock Exchange (WSE: UCG). It is also a component of the EURO STOXX 50 stock market index and a FTSE MIB stock market index component.
UniCredit was founded in 1998 after the merge of various Italian banking groups from Verona (Cariverona), Turin (Cariturin), Treviso (Cassamarca), as well as the banks that formed the Unicredito Italiano Group (Rolo Banca, and Banca Popolare di Rieti). In 2000, UniCredit made its first pivotal move by merging with the Bank Austria, followed by its S3 project in 2002, which merged 7 of their bank network. Three years later, the company added HypoVereinsbank (HVB) to its list of subsidiaries, which boosted the outstanding growth of the group. As of 2018, UniCredit owns and operates 16 subsidiaries.
Over the course of 3 years, between 2015 and 2017, UniCredit sold its non-performing loans (NPLs)1, along with its subsidiary that specialized in managing NPLs, UniCredit Credit Management Bank, to Fortress Investment Group, an investment management company based in New York City. Other major transactions include the securities services business (2S Banca) which was sold to Société Générale for €579.3 million in 20062; the Ukrainian bank, Ukrsotsbank, which was sold to Alfa Group in January 20163; and the card business from Austria, Germany, and Italy – which was sold to the Italian company SIA for €500 million4.
UniCredit Stock: outlines and reasons to buy it
UniCredit (BIT: UCG) is one of the few companies that managed to maintain a great financial health over the years and trade at a very attractive share price7. The earning and dividends per share have been stable in the past 10 years 8, with a payout ratio of around 20% 9.
In 2017, the company had revenue of €19.619 million and its net income reached 3.708 million, maintaining a positive year on year earnings growth rate for five consecutive years10. In addition, over the course of the same year it increased its use of capital from 1.5% to 3%. Following the cyclical peak in 2017 (4.6 per cent excl. RU&TR) and average GDP growth of 3.7 per cent in 2018, the region’s economic growth is likely to remain above potential in 2019 (around 3.2 per cent on average), but may slow in 2020 as a result of potentially weaker global trade11.
The UniCredit stock is publicly listed and traded on the Italian Stock Exchange (BIT: UCG), the Frankfurt Stock Exchange (FWB: CRI), and the Warsaw Stock Exchange (WSE: UCG). It is also a component of the EURO STOXX 50 and FTSE MIB stock market indices. UniCredit has a price/earnings to growth ratio (PEG) of 0.5x and it is one of the most valuable Italian Stocks based on both earnings and expected growth12.
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- Valentina Za, “UniCredit closes $20 billion bad loan sale with Fortress, Pimco”, Jul, 2017, reuters.com, https://www.reuters.com/article/us-italy-banks-unicredit-npl/unicredit-closes-20-billion-bad-loan-sale-with-fortress-pimco-idUSKBN1A21SU
- Unicreditgroup.eu, “UniCredit: Closing of the 2S Banca sale to SocGen”, https://www.unicreditgroup.eu/en/press-media/press-releases/2006/PressRelease0295.html
- Unicreditgroup.eu, “UniCredit Group completes sale of Ukrsotsbank to Alfa Group’s ABH Holdings”, https://www.unicreditgroup.eu/en/press-media/press-releases-price-sensitive/2016/unicredit-group-completa-la-vendita-di-ukrsotsbank-a-abh-holding.html
- Unicreditgroup.eu, “UniCredit to sell its card processing activities in Italy, Germany and Austria to SIA “, https://www.unicreditgroup.eu/en/press-media/press-releases-price-sensitive/2016/unicredit-vende-a-sia-le-sue-attivita-di-elaborazione-dei-pagame.html
- Thomas Hale , “Italy’s UniCredit issues its first bond in the US in a decade”, Apr, 2017, ft.com, https://www.ft.com/content/35a9d8b1-f869-3cd0-8f58-43523ffd5af4
- Unicreditgroup.eu, ” 2017 Consolidated Reports and Accounts”, unicreditgroup.eu, https://www.unicreditgroup.eu/content/dam/unicreditgroup-eu/documents/en/investors/financial-reports/2017/4Q17/2017-Consolidated-Reports-and-Accounts.pdf
- Stephen Morris, Cat Rutter Pooley, “Italy’s UniCredit posts best underlying profits in a decade”, Feb, 2019, ft.com, https://www.ft.com/content/5333f9ac-2a77-11e9-a5ab-ff8ef2b976c7
- Unicreditgroup.eu, “Earnings and dividend per share”, unicreditgroup.eu, https://www.unicreditgroup.eu/en/investors/share-information/dividends.html
- unicreditgroup.eu, “UniCredit: a pan-European winner. 4Q18 and FY18 Group Results”, Feb, 2019, https://www.unicreditgroup.eu/en/press-media/press-releases-price-sensitive/2019/unicredit–a-pan-european-winner–4q18-and-fy18-group-results-.html
- Unicreditgroup.eu, “Consolidated Reportsand Accounts 2017”, https://www.unicreditgroup.eu/content/dam/unicreditgroup-eu/documents/en/investors/financial-reports/2017/4Q17/2017-Consolidated-Reports-and-Accounts-General-Meeting-Draft.pdf
- Unicreditgroup.eu, “Central and Eastern Europe will maintain a healthy growth pace in 2019”, https://www.unicreditgroup.eu/en/press-media/press-releases/2019/central-and-eastern-europe-will-maintain-its-growth-pace-in-2019.html
- Unicreditgroup.eu, “UniCredit: Transform 2019 first year successfully completed, all targets achieved”, Jan, 8, 2019, https://www.unicreditgroup.eu/en/press-media/press-releases-price-sensitive/2018/unicredit–transform-2019-first-year-successfully-completed–all.html