Financial Data and Key Metrics Changes - Customer lending grew 3.2% to GBP 384 billion, while customer deposits increased by 1% to GBP 436 billion [3][4] - Income rose 13.7% to GBP 8 billion, and costs decreased by 1.4% to GBP 3.9 billion, resulting in an operating profit of GBP 3.6 billion and attributable profit of GBP 2.5 billion [4][5] - Return on tangible equity was 18.1%, and earnings per share increased by 28% to 31p [4][5] - Interim dividend announced at 9.5p, up 58%, with TNAV per share growing 16% to 351p [5] Business Line Data and Key Metrics Changes - Retail Banking saw lending growth of 3%, with deposits up 1% [7] - Commercial and Institutional lending increased by 4% and deposits by 2%, driven by project finance and sustainable finance [8] - Private Banking and Wealth Management experienced a 2% growth in lending and net new inflows of GBP 1.5 billion, representing 8.1% of opening AUM [9] Market Data and Key Metrics Changes - The bank attracted over 100,000 new customers through organic growth and the Sainsbury's transaction, which added around 1 million new customers [6][7] - The bank's share in credit cards increased from 9.7% to 11% due to the Sainsbury's acquisition [8] Company Strategy and Development Direction - The company is focused on disciplined growth, customer base expansion, and enhancing customer experience through digitization and simplification [6][10] - A new target of delivering GBP 200 billion in climate and transition finance by 2030 has been set, building on previous achievements [9][10] - The bank is modernizing its technology and operational model, including a strategic collaboration with AWS and Accenture to enhance data capabilities [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to continue delivering broad-based lending growth despite a challenging UK economic backdrop [49][50] - The bank upgraded its 2025 guidance for income to greater than GBP 16 billion and return on tangible equity above 16.5% [15][29] - Management noted that the diversified loan book is performing well, with expectations of a loan impairment rate below 20 basis points for the full year [25][29] Other Important Information - The CET1 ratio remained stable at 13.6%, with strong capital generation allowing for investments and shareholder returns [5][28] - The bank is actively managing its balance sheet, generating 101 basis points of capital in the first half [14] Q&A Session All Questions and Answers Question: On deposit flows and current accounts - Management acknowledged the growth in deposits but noted some loss in current accounts, attributing it to a disciplined pricing strategy amid competitive conditions [34][39] Question: On lending outlook and revenue guidance - Management expressed confidence in continued lending growth, supported by strong volumes and the full run rate from the Sainsbury's acquisition [46][49] Question: On capital management and potential M&A - Management clarified that they are not building a buffer for M&A but are focused on organic growth and maintaining a balanced capital allocation strategy [52][53] Question: On structural hedge and mortgage spreads - Management indicated that the structural hedge is performing well, with expectations of continued support for income, while mortgage spreads are stabilizing [57][63] Question: On FX risk management derivatives - Management explained that FX risk management activities are designed to take advantage of market volatility, contributing positively to overall income despite appearing as negative NII [98][101] Question: On lead reforms and mortgage market opportunities - Management expressed support for lead reforms, anticipating positive impacts on the mortgage market and increased borrowing capacity for first-time buyers [104][106]

Financial Performance - NatWest Group raises its guidance for the year [1] - NatWest Group reported second-quarter earnings that topped analyst estimates [1] Capital Allocation - NatWest Group announced a £750 million share buyback [1]

Group 1 - The profile highlights the finance professional's extensive experience in global markets, focusing on macroeconomic analysis, portfolio management, and equity research [1] - The current role involves leading multi-asset strategies and managing equity portfolios, emphasizing a combination of top-down macro insights and bottom-up stock selection [1] - The research approach is grounded in fundamentals, utilizing tools like Bloomberg Terminal and advanced Excel models for valuation and risk monitoring [1] Group 2 - The analyst expresses a commitment to sharing high-conviction investment ideas, particularly in undercovered names and contrarian opportunities [1] - The analysis aims to be rigorous, strategic, and actionable, catering to both retail and institutional investors [1] - There is a focus on transparency and clarity in the analysis provided, aiming to cut through market noise to deliver valuable insights [1]

NatWest continues exit from Republic of Ireland https://t.co/KwQNBe77aW ...

Core Viewpoint - The U.S. stock market is facing challenges near all-time highs, leading investors to consider international banking stocks as a viable option for capital preservation and income generation amidst weakening economic data and global conflicts [1][5]. Group 1: Investment Landscape - U.S. investors have historically benefited from a domestic bias, but recent performance indicates that European stocks have outperformed U.S. stocks since the end of the 2022 bear market [2][3]. - The S&P 500 has been one of the worst-performing indices in the developed world since the start of 2025, prompting a reevaluation of investment strategies [3]. Group 2: Reasons for Shifting Investment Attitudes - Differing macroeconomic environments are influencing investment decisions, with the Federal Reserve maintaining rates while the European Central Bank is cutting rates, potentially leading to stifled growth in the U.S. [8]. - The U.S. dollar is losing its status as a safe haven, as evidenced by its depreciation during market turmoil, which benefits international banks with foreign currency revenue [8]. - Attractive valuations of international banks compared to U.S. peers are drawing investor interest, as the S&P 500 trades at around 23 times 2025 earnings, while European and Canadian banks are trading at lower multiples [8]. Group 3: International Bank Stocks - **Royal Bank of Canada (RY)**: Reported a 42% year-over-year EPS growth and record net income of $5.1 billion, driven by the acquisition of HSBC Bank Canada, with a dividend yield of 3.52% and a P/E ratio of 14.13 [11][12]. - **Banco Santander (SAN)**: Achieved record profits with a 19% increase in income and a 26% increase in EPS year-over-year, trading at a P/E ratio of 9.20 and a dividend yield of 2.25% [13][14]. - **NatWest Group (NWG)**: Increased income by nearly 16% year-over-year, with a dividend yield of 5.65% and a P/E ratio of 9.14, supported by strategic acquisitions and partnerships to enhance market share and efficiency [17][18].

Market Overview - U.S. stock markets are experiencing a positive trend after recent volatility, with the S&P 500 near its all-time high and both the Nasdaq Composite and Dow showing positive year-to-date performance [1][2] Economic Factors - Ongoing trade negotiations between the U.S. and China, stability in the U.S. labor market, and a declining inflation rate have improved market sentiment towards equities [2] Investment Opportunities - Non-tech stocks have shown significant appreciation year to date, alongside discussions of AI, quantum computing, and 5G/6G technologies [3] Recommended Stocks - Five corporate giants with market capitalizations over $50 billion have provided returns exceeding 40% year to date, all holding a Zacks Rank 1 (Strong Buy) [4][5] Howmet Aerospace Inc. (HWM) - Benefits from strong momentum in the commercial aerospace market and defense aerospace business, supported by rising U.S. and international defense budgets [8] - Expected revenue and earnings growth rates of 8.5% and 28.6% respectively for the current year, with a 4.2% improvement in earnings estimates over the last 30 days [9][10] Newmont Corp. (NEM) - Progressing with growth projects, including the Tanami expansion and the acquisition of Newcrest, which enhances operational synergies [11] - Expected revenue and earnings growth rates of 2% and 20.1% respectively for the current year, with a 9.7% improvement in earnings estimates over the last 30 days [12] Philip Morris International Inc. (PM) - Strong pricing power and an expanding smoke-free product portfolio, with products like IQOS and ZYN driving growth [13] - Expected revenue and earnings growth rates of 8.1% and 13.7% respectively for the current year, with a 4.6% improvement in earnings estimates over the last 60 days [15] NatWest Group plc (NWG) - Provides a range of banking and financial services, with expected revenue and earnings growth rates of 20.1% and 17.3% respectively for the current year, and a 6.8% improvement in earnings estimates over the last 30 days [16][17] Deutsche Bank Aktiengesellschaft (DB) - First-quarter 2025 results benefited from increased revenues and lower expenses, with a focus on stable, capital-light businesses driving revenue growth [18][19] - Expected revenue and earnings growth rates of 12% and over 100% respectively for the current year, with a 4.2% improvement in earnings estimates over the last 60 days [19]

Core Viewpoint - The market turbulence following President Trump's announcement of increased tariffs appears to have subsided, but the risk departments of major global banks remain cautious, implementing measures to mitigate potential losses while potentially sacrificing profits [1]. Group 1: Market Reactions and Strategies - Major banks like Bank of America, NatWest Markets, and Dutch Bank are taking precautionary measures such as daily risk inquiries, stress testing portfolios, and reducing swap positions to lower the risk of significant losses [1]. - Despite the recent calm in the markets, there are concerns about a potential new shock comparable to the one in April, particularly with the upcoming deadline for raising the U.S. federal debt ceiling and the expiration of Trump's tariff exemptions [1]. Group 2: Bond Market Dynamics - The volatility in the U.S. bond market surged to a two-year high in April, with both U.S. Treasuries and equities experiencing significant sell-offs, indicating a breakdown of the safe-haven role of U.S. bonds during stress periods [6][7]. - There are signs of a rebound in demand for longer-term bonds, as weak U.S. economic data has recently pushed up Treasury prices, while Japan's 30-year bond auction results were better than expected [5]. Group 3: Risk Management Practices - The uncertainty in the market has led to a reduction in positions by trading departments, with a focus on managing risks associated with potential volatility spikes, particularly in light of upcoming employment data [5][6]. - Risk management techniques such as scenario analysis and Value at Risk (VaR) are being employed to assess potential losses, but predicting market conditions remains challenging due to the unpredictable nature of current events [6].

Market Overview - Wall Street has experienced volatility in 2025 due to overstretched valuations of U.S. stocks, persistent inflation, weak economic data, geopolitical conflicts, and concerns regarding the Trump administration's trade policies [1] - The Federal Reserve's uncertainty over rate cuts, recession fears, and the emergence of a low-cost Chinese AI platform have contributed to investor unease [1] Investment Strategy - It is advisable to invest in high dividend-paying corporate giants, which typically possess strong financial positions, robust business models, and globally recognized brand value [2] - Regular dividend payments from these firms can provide a steady income stream during market fluctuations [2] Company Highlights Philip Morris International Inc. (PM) - Zacks Rank 1, benefiting from strong pricing power and an expanding smoke-free product portfolio, aiming to become substantially smoke-free by 2030 [6][7] - Expected revenue and earnings growth rates of 8.1% and 13.7% respectively for the current year, with a current dividend yield of 3.01% [8] CVS Health Corp. (CVS) - Zacks Rank 2, investing in technology to reduce costs and enhance customer experience, with plans to close 271 stores to save over $500 million in 2025 [9][10] - Expected revenue and earnings growth rates of 3.7% and 12.6% respectively for the current year, with a current dividend yield of 4.34% [10] Energy Transfer LP (ET) - Zacks Rank 2, benefiting from long-term fee-based contracts, with nearly 90% of earnings from such contracts [11][13] - Expected revenue and earnings growth rates of 18.2% and 12.5% respectively for the current year, with a current dividend yield of 7.30% [13] GSK plc (GSK) - Zacks Rank 2, strong position in HIV and Vaccines, with increased sales growth in Specialty Medicines and promising new products [14][15] - Expected revenue and earnings growth rates of 5.1% and 6.7% respectively for the current year, with a current dividend yield of 4.28% [16] NatWest Group plc (NWG) - Zacks Rank 1, providing a range of banking and financial services in the UK and internationally [17][18] - Expected revenue and earnings growth rates of 20.1% and 17.3% respectively for the current year, with a current dividend yield of 5.41% [19]

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock char ...

Core Insights - The article discusses an active investing strategy focused on identifying breakout stocks within a specific price range, emphasizing the importance of support and resistance levels in making investment decisions [1][2][3]. Group 1: Breakout Stocks - Barclays PLC (BCS), NatWest Group plc (NWG), and Aris Mining Corporation (ARMN) are highlighted as today's breakout stocks [1]. - BCS anticipates an earnings growth rate of 21.2% for the current year [7]. - NWG expects an earnings growth rate of 17.3% this year [9]. - ARMN projects an impressive earnings growth rate of 226.5% for the current year [10]. Group 2: Screening Criteria - The screening criteria for selecting breakout stocks include a percentage price change over four weeks between 10% and 20%, current price close to 52-week highs, and a Zacks Rank of 1 [6]. - Additional criteria include a beta for 60 months less than or equal to 2 and a current price less than or equal to $20 [7]. - These criteria narrow down the stock universe from over 6,853 to only nine potential candidates [7].