To The Moon

Simply Wall St.2025-08-20 18:14

For those watching DBS Group Holdings (SGX:D05), you may have noticed the stock has quietly moved up in recent weeks. This has caught the attention of investors who are weighing what comes next. There is no single headline driving this movement, but the price momentum might prompt some to wonder whether the market is hinting at something beneath the surface or simply responding to broader sentiment. Whenever a well-followed bank like DBS changes direction without an obvious catalyst, it often raises questions about valuation and whether there is more upside to capture.

This uptick comes after a strong performance over the past year. DBS Group Holdings posted a 47% return and climbed 13% year-to-date, far outpacing most regional peers. In the past month, its shares surged another 6% following a steady set of results and modest underlying revenue growth. Longer-term investors will remember the remarkable three-year return exceeding 100%. Recent gains suggest momentum is still in play, even as the overall market debates the outlook for interest rates and the health of Asian financials.

With the stock approaching all-time highs, investors may be questioning whether DBS Group Holdings is still undervalued by the market or if the recent rally has already priced in years of potential growth. Here is a closer look at whether there could be further upside, or if caution may be warranted at this stage.

Most Popular Narrative: 3% Undervalued

According to community narrative, DBS Group Holdings is considered to be trading at a slight discount to its estimated fair value as analysts see room for further upside, but with limited margin of safety.

Continued robust wealth management and asset under management (AUM) inflows are being driven by rising affluence in Asia, increased wealth planning needs, and client preference for DBS as a trusted, technologically advanced institution. This is likely to deliver sustained long-term growth in fee and commission income and boost overall revenue.

Curious what’s powering DBS’s premium valuation? There is one core projection from analysts’ models that holds the key. It all comes down to big expectations for continued growth, ambitious forecasts for profits, and a confidence in future business model resilience. Want to know what assumptions take center stage, and what DBS’s performance would need to look like for the stock to reach its fair value? Keep reading to uncover the numbers shaping this narrative.

Result: Fair Value of $51.38 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent low interest rates or regulatory roadblocks could weaken DBS’s growth narrative and challenge assumptions about long-term earnings potential and valuation upside.

Find out about the key risks to this DBS Group Holdings narrative.

Another View: Taking a Step Back With the SWS DCF Model

While analyst targets suggest DBS Group Holdings is close to fair value, our DCF model shows the shares may actually be trading at a more notable discount. This approach places less emphasis on today's market optimism and instead focuses on expected future cash flows. Which view will prove right as conditions shift?

Look into how the SWS DCF model arrives at its fair value.

D05 Discounted Cash Flow as at Aug 2025

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out DBS Group Holdings for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own DBS Group Holdings Narrative

Of course, if you have a different perspective or want to dig deeper into the numbers yourself, you can easily build your own view in just a few minutes, or even do it your way.

A great starting point for your DBS Group Holdings research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

source：Simply Wall St.