Banco Santander SA

Financial Performance

5Y price score: 419

10Y return: 374%

DATE RANGE:

EUR Per
Share

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7.9

52-week range

13.1

12.692

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Required return / cost of capital

FCFF terminal growth rate

Your fair value & Margin of safety

To calculate fair value based on cost of capital and terminal growth assumptions above, please select free cash flow forecast.

Forecast:

Valuation

Free Cash Flow Yield

29.6 %

Dividend Yield TTM

1.9 %

Market cap

186,296

Price / Earnings TTM

11.6

Price / Book TTM

1.7

PEG TTM

1.3

Earnings growth and return

LTM

5YR

10YR

Total return (price & dividends)

56 %

317.6 %

374 %

Free cash flow per share growth

(113.1) %

57 %

2,064.2 %

Earnings per share growth

9.1 %

266.7 %

114.3 %

Founded: 1,857

Employees: 206,736

Business Summary:Banco Santander, S.A. provides various retail and commercial banking products and services to individuals, small and medium-sized enterprises, and large companies worldwide. It offers demand and time deposits, and current and savings accounts; mortgages, consumer finance, syndicated corporate loans, structured financing, cash management, export and agency finance, trade and working capital solutions, and corporate finance; and insurance products. The company also provides cash, asset, and wealth management; and private banking services. In addition, it is involved in the corporate banking; treasury, risk hedging, foreign trade, confirming, custody, and investment banking activities. The company operates through a network of 9,879 branches. The company was formerly known as Banco Santander Central Hispano S.A. and changed its name to Banco Santander, S.A. in June 2007. Banco Santander, S.A. was founded in 1856 and is headquartered in Madrid, Spain.

Fair Value Reference Estimate

Latest Earnings Call Takeaways

2026 Q2 (Jul 22, 2026)

1) Strategy & Leadership
- Santander reported a record quarterly profit of EUR 3.8 billion for Q2 2026, marking the best half ever for the bank.
- The acquisition of TSB, completed on April 30, 2026, is expected to enhance Santander's scale and efficiency in the UK market.
- The ONE Transformation strategy is driving operational improvements, with a focus on simplification and automation, resulting in a 3% improvement in efficiency.
- The bank aims for a return on tangible equity (RoTE) of over 20% by 2028, supported by disciplined capital allocation and the integration of TSB and Webster.

2) Financial & Segment Results
- Underlying profit grew 14% YoY, with total revenue increasing by 6% in constant Euro, driven by strong net interest income (NII) and record fees.
- NII rose 6% YoY, supported by margin resilience and profitable volume growth, while fees increased by 7% across all businesses.
- Retail banking's underlying profit grew 12% YoY, with active customer growth contributing to improved profitability.
- CIB revenue increased by 16% YoY, driven by strong client flows and global banking fees, while Wealth and Payments also reported solid growth.

Metric	Q2 2026	YoY Change
Quarterly Profit	EUR 3.8B	+14%
Total Revenue	N/A	+6%
NII	N/A	+6%
Fees	N/A	+7%
Underlying RoTE	15.6%	N/A

3) Problems / Headwinds
- Loan loss provisions (LLPs) were impacted by deteriorating conditions in Argentina, although overall provisions were stable excluding this market.
- The integration of TSB is expected to incur additional restructuring costs, with EUR 250 million already recognized in Q2.
- The competitive environment in the UK and Brazil remains intense, particularly in deposits and mortgages, which may compress margins.

4) Operational or Product Plans
- Santander is focused on enhancing customer engagement through its customer interaction platform, which is set to roll out in Spain.
- The bank is expanding its mobility finance solutions and optimizing funding through Openbank, which has already gained 2.6 million customers.
- The integration of TSB is expected to yield at least EUR 400 million in synergies by 2028, with ongoing efforts to simplify operations and improve profitability.
- In Wealth and Insurance, Santander aims to penetrate its existing customer base more effectively, capitalizing on growth opportunities in various markets.

5) Guidance & Outlook / Investor Angle
- Santander is on track to exceed its profit guidance of EUR 14.1 billion for 2026, excluding M&A impacts.
- The bank expects to maintain strong revenue growth and operational leverage in the second half of 2026, with a stable cost of risk anticipated.
- Capital generation remains robust, with a CET1 ratio of 14%, and the bank is well-positioned to meet its regulatory requirements while pursuing growth.

Bottom line: Santander's strong performance in Q2 2026, driven by strategic acquisitions and operational efficiencies, positions it favorably for sustainable growth and value creation for shareholders, despite facing challenges in certain markets.

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