I like this buy recommendations, what of dyer and blair??

this recommendation has been their for the whole of 2014, let see if it will materialize this year

January 2015 stock picks - Source: NIC

COOP BANK BUY at TP 25.84 Current price KES 18.90

♦ Relatively poor 3Q14 slowed y/y performance. Co-op’s 9M14 PBT growth was much slower at 2.5%y/y, surprising on the downside given that 1H14 PBT grew at 15%y/y. The q/q growth of 35% was weaker than the 52% growth recorded over a similar period last year, resulting in a higher base.

♦ NIMs expanded by 40bps y/y and 70bps q/q to 9.5% defying the trend across the sector and in spite of increased lending to the corporate sector. Going forward, NIMs expansion could be maintained given the launch of M-Coop Cash, a mobile banking platform targeting the high margin micro and consumer segments offering unsecured loans of between KES 100 and KES 200,000 attracting a one off interest rate of 7% (lower than CBA’s M-Shwari rate of 7.5%, but higher than EQB’s 1-2%) and repayable within 30 days.

♦ Increased presence translating into stronger loan growth. Loan book expanded by 31% y/y in 3Q14 benefiting from an expansion drive that has seen 49 new branches over the last 3 years, with 20 added in FY13. Management expects the increased presence to help sustain strong loan growth.

♦ Accelerating growth in non-funded income to support earnings as net interest margins decline. NIR increased by 23% y/y in 3Q14. NIR expected to improve due to increased transactions as customers numbers grow.

♦ Operating expenses expected to ease as COOP slows down on branch expansion in favor of consolidation of the existing branches. CIR stood at 58% in 3Q14. Break even of new branches also key to reducing CIR