UPDATE: Societe Generale Upgrades UBS to Buy on Dividend Outlook

Societe Generale raised its rating on UBS

from Hold to Buy as positive operating results could allow the company to pay a dividend to shareholders. Societe Generale said, "We are upgrading UBS to Buy with a target price of CHF 16.0. This assumes the investment banks hold together in 2013 and 2014, i.e., the combined old entity still writes a small positive operating result, which would allow the bank to start paying dividends in Q2 2014 of CHF 1.58 and of CHF 1.82 in Q2 2015. In total we could see UBS paying back CHF 19.2bn between now and end-2017. Our concerns are around the timing (or cost) of the portfolio run-off and the fact that the resulting ‚rump IB‛ still does not earn the cost of equity." UBS closed at $15.02 on Wednesday.