IITOF - Intesa Sanpaolo: Questions On Dividend Sustainability Weigh Heavily

Thesis: Intesa (IITOF) yields 8% and has become a favourite amongst income investors in European banks. However, maintaining such a high payout ratio in an environment where capital regulations are uncertain and the profit outlook is weak seems a risky strategy. With the dividend having become such a defining issue and with the stock trading at a premium valuation to peers, the downside risks to the share price are large if expectations cannot be met.

A quality name in a sector that has too few of them

At close to 0.9x net asset value

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