Societe Generale SA
GLE: XPAR (FRA)
| Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
|---|---|---|---|
| €73.40 | Hwww | Gls |
Societe Generale's Low Profitability Justifies Discount Compared With Peers
Business Strategy and Outlook
Societe Generale, or SocGen, has not been able to generate a level of profitability ahead of its cost of capital since 2006, and we do not anticipate any changes that will position the bank to outearn its cost of capital on a consistent basis. Cost-cutting can potentially improve profitability, but there is also an inflexion point where further cost-cutting will result in damage to the franchise.