WF - Woori Financial: The Stars Are Not Aligned

• Woori Financial does not have a brokerage business and it is unable to capitalize on the Korean stock market boom, and its M&A plans could be adversely affected as well.
• There are downside risks to Woori Financial's FY 2020 dividend, considering regulatory pressure and the possibility of "kitchen sinking".
• A change in controlling shareholder is a medium-term catalyst for Woori Financial, with the Korean government planning to divest its 17.25% equity interest by 2022.
• Woori Financial is valued by the market at 4.2 times forward FY 2021 P/E and 0.31 times P/B, and it offers a forward FY 2021 dividend yield of 6.4%.

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