BofA Revises Price Objective, Estimates for Banco Santander Amid Expectations of 'Solid' Q2 Results

07:32 AM EDT, 07/15/2026 (MT Newswires) -- BofA Global Research updated its price objective and earnings forecasts for Banco Santander (SAN.MC, BNC.L) to reflect recent operating trends and the Spanish lender's restatement, ahead of what the research firm anticipates will be a "solid" second quarter. In an earnings preview note for Spanish banks published Wednesday, analysts raised their net interest income and fees estimates by 3% and 4% to 5%, respectively, for full-year 2026 through 2027. BofA's net profit forecasts were also boosted by 2% to 5% for 2027 to 2028, with 2027 EPS projections lifted by 4% on a higher share count. "We also see further room for cost savings by 2028e as synergies from M&A transactions and standalone initiatives are achieved," the research firm wrote. "Our [dividend per share] is also materially higher as we reflect improved distribution mix." Against this backdrop, BofA increased its price objective to 13.8 euros from 11 euros and lifted its American depositary receipt price objective to $15.78 from $13.80. "Santander trades at an undemanding valuation. Its Brazilian unit (c.20% of earnings) comes with higher for longer SELIC rates. Santander's funding is largely tied to the SELIC, while its loans are fixed. The duration gap means [net interest margin] in Brazil will get worse before it gets better. Given the loan mix skew to consumer, rates could also affect affordability via loan losses and new lending in Brazil, the US and DCB. However, both the outlook for efficiency gains and capital has improved materially, but now use of excess capital is in focus - we prefer to gain exposure elsewhere - Neutral," the note said.