Merrill Lynch keeps the bank on its "most preferred list", albeit with a "Neutral" rating.
Merrill Lynch today reiterated its "most preferred" stock rating for Mizrahi Tefahot Bank (TASE:MZTF).
Merrill Lynch noted, "With the US sub-prime malaise and the growing fear of a US and global slow-down ‘rocking’ the financials, we believe that Mizrahi Tefahot Bank could prove to be a relatively safe haven. Predominantly focused on high-quality local consumers, with practically no exposure to overseas markets, almost zero exposure to US sub-prime markets, and a high quality loan portfolio this could be the right place to hide for the short term. Management has a proven track-record communicating with capital markets, and has successfully articulated a clear message to the markets, as highlighted by the recent publications of the bank’s five-year strategic plan targeting a return on equity of 18%, and we expect no negative surprises in the near term."
Merrill Lynch nevertheless reiterates its "Neutral" rating on Mizrahi Tefahot Bank and believes that it is fairly valued at current levels. Even so, in the short term, "Mizrahi Tefahot Bank qualities could offer a safe haven to global turbulence."
Published by Globes [online], Israel business news - www.globes-online.com - on January 30, 2008
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