Analyst Note| Johann Scholtz, CFA |
Narrow-moat UBS reported another very strong quarter, profit before tax increased by 41% year on year to $2,1 billion--this is after adjusting for items of a one-off nature. Revenue of $8.5 billion for third-quarter 2020 was comfortably ahead of the $7.9 billion the analyst consensus collected by UBS expected. We estimate that UBS will return $4.6 billion, or 10% of its current market value, to investors through dividends and share buybacks, provided the regulator lifts the ban on dividends. We increase our fair value estimate to CHF 14/share, and maintain our narrow moat rating.