Bank Bradesco SA ADR BBD

No-moat-rated Bank Bradesco’s recurring net income recovered to its pre-COVID-19 levels in the fourth quarter and was reported at BRL 6.8 billion, up 35.2% sequentially and 2.3% on a year-over-year basis. The bank posted an impressive quarterly return on average equity of 20% in a challenging macroeconomic environment.  Solid revenue generation, improving efficiency, manageable asset quality, and adequate reserves hold the bank in good stead for the upcoming year. As we more fully incorporate these results, we don't expect a large change to our fair value estimate of $3.90 per ADR share, although due to updated exchange rates we would expect an increase of roughly 8%, all else equal.