Hot stock: DBS rises 2.4% to 52-week high after release of Q1 results

SHARES of D05 rose to a 52-week high on Friday after it posted a 72 per cent year-on-year rise in net profit to S$2.01 billion for the quarter ended March 31.

As at 11.26am, the index counter hit S$30.09 after climbing S$0.70 or 2.4 per cent, with about 5.5 million shares changing hands.

No married deals were recorded in early trade, according to ShareInvestor data.

The other two Singapore banks were also trading higher at the time, with OCBC up S$0.16 or 1.3 per cent at S$12.28, and UOB advancing S$0.14 or 0.5 per cent to S$26.73.

DBS's latest set of results marks the first time in the bank's history that its quarterly net profit crossed the S$2 billion mark.

In its pre-market filing on Friday, Singapore's largest bank attributed its record first-quarter performance mainly to sustained inflows into current and savings accounts, as well as broad-based loan growth. The bank also declared an interim dividend of 18 Singapore cents per share.

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Analysts covering DBS remain bullish on the lender's prospects, with Morgan Stanley maintaining "overweight" on the stock with a price target of S$28.40. While the research house noted the higher wealth fees, higher trading and lower loan loss as "surprises", its analysts say this is in line with the performance of other banks.

Likewise, Citigroup analyst Robert Kong said he considers the quarterly results a "huge beat" on double-digit growth in fees and low credit costs. The brokerage has a "buy" call on DBS with a S$32.20 target price.

JPMorgan - which has an "overweight" rating on DBS and a S$33.00 price target - highlighted the stock as "one of its highest-conviction" buys with the latest Q1 financials confirming reasons for this optimism.

"Overall, we see DBS improving value creation across geographies, asset classes, business lines and technology frontiers. We see the bank consistently delivering best-in-class return on equity for the next few years, leading to highest multiple in at least last two decades," said JPMorgan in its report on Friday.