Analysis of Santander share price for trading

If you are looking for profitable assets to integrate into your stock market portfolio then those of the European banking sector are undoubtedly excellent choices, even more so as they can also be traded online.  Among these shares those of the Santander Group are highly popular with individual investors. However, to trade in this asset it is imperative that you are able to complete a pertinent analysis of its share price. Here therefore is some information and advice to assist you with this.    

75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.


About the Santander Group:

The Santander group, or Banco Santander, is the leader of the Spanish banking sector. Its activities can be classified into three main sectors starting with of course its commercial banking activities, operations and services, plus the investment banking sector including finance and markets, and finally asset management and private banking activities.   

The major part of this group’s income comes from the United Kingdom and continental Europe, as well as Latin America and the United States. It currently manages no less than 660 billion Euros of outstanding credit and 600 billion Euros of deposits.


The major competitors of Santander:

The banking group, Banco Santander, is currently one of the bank sector leaders in Spain. But it is also trying for a major position on the European market and, with this aim, faces considerable competition from other large banking groups. Here we offer you the opportunity to learn more about the major European competitors to Santander in 2016.

The top 8 of the largest European banks in 2016 are as follows:

  • BNP Paribas (€2,392.18 billion)
  • Barclays (€1,958.55 billion)
  • Deutsche Bank (€1,955.47 billion)
  • Crédit Agricole (€1,803.30 billion)
  • Royal bank of Scotland (€1,527.70 billion)
  • Société Générale (€1,428.80 billion)
  • Banco Santander (€1,369.69 billion)
  • BPCE (€1,238.57 billion)

By analysing changes in this list and the financial accounts of each of these competitors to Santander you will have a lot of useful information that will assist you in completing a comprehensive fundamental analysis of this stock market share.


The major partners of Santander:

To conclude here is a summary of the major partnerships implemented by the Santander Group during recent years.

  • In 2014 the CNP Assurances group announced the signature of an exclusive long term distribution agreement with Santander Consumer Finance (Groupe Banco Santander) as well as the 51% acquisition of its life and other insurance subsidiaries.
  • A partnership between the PSA financial bank and Santander Consumer Finance was signed in 2013 and the joint venture in Poland started its activities on 3rd October 2016. This company has been responsible since then for the financing of the automobile concessions for Peugeot, Citroen and DS.
  • The largest bank in Morocco, Attijariwafa, and the largest Spanish bank, Santander, signed an agreement in 2016 to facilitate their clients’ procedures.


Different subsidiaries of the Banco Santander group:

The Spanish group Banco Santander has a number of different subsidiaries that it is important to know about to be able to identify the different sectors of its activity and its reach over the international stock markets.

  • It holds 100% of the shares of the Abbey National building society in the United Kingdom.
  • It also holds a 100% shareholding of Sovereign Bancorp in the United States.
  • 98.5% of the shares of Banesto in Spain.
  • 93% of the shares of Banco de Venezuela in Venuzuela.
  • 50% of the shares of Banco Rio de la Plata SA in Argentina.
  • A 30% shareholding in Banespa (Banco di Estado de Sao Paulo) in Brazil.
  • A 5.6% shareholding of the AttijariWafa Bank in Morocco.

The Banco Santander group also holds a 7.57% shareholding in the company Banci de Galicia y Buenos Aires SA in Argentina and 4% of the shares of the Commerzbank AG in Germany, 1.5% of the French banking group Société Générale and 30.21% of the Spanish company Antena 3.


Analysis of the Santander share price:

The price of Santander shares is quoted on the NYSE Euronext in Amsterdam and the rate is included in the calculations of the Euro Stoxx 50. Although it is currently experiencing a slight fall in the price, specialist share market analysts believe that the price should recover rapidly, thereby raising the possibility for comfortable profits for traders.


Important stock market data about Santander shares:

In order to complete the information that you have read on this page such as a historical technical analysis or the detailed activities of this Spanish banking group, here is some more general information that you should also be aware of:

  • In 2017, the total stock market capital of the Banco Santander group attained €87,873.19 million.
  • The number of shares issued by the Banco Santando Company and in circulation on the stock markets is around 14,582,340,701.
  • The Santander share price is actually quoted on the Mercado Continuo section of the Mercado Continuo stock market in Spain.  
  • The Santander Group share price is also integrated in the calculation of the National Spanish stock market Index, the Ibex 35.
  • 56.3% of Santander’s shareholders are institutional, 42.50% are individuals and 1.2% of the shares are held by the administrators.


The advantages and strong points of Santander shares as a stock market asset:

To implement a long term strategy on the purchase of Santander shares it is of course necessary to understand and appreciate the abilities of this banking sector company to develop its growth and respond to future challenges. To assist you in analysing these aspects here is a detailed summary of the advantages of this group and its major strengths that could influence a rise in its share price.

Firstly, the Santander banking group is one of the major financial companies worldwide and shows consistently positive results from a financial perspective. We note a conspicuous increase in the turnover of this company over recent years, particularly since 2015. This company also benefits from an advantageous position on the world financial markets as it was classified 23rd in the Forbes Global list of the largest international companies of 2000.

The worldwide reputation of this banking group is another strong point for Santander. This bank is in fact well known throughout the world and boasts a positive brand reputation which is fairly rare for a business in this sector. This aspect is also highly reassuring for investors.  

The distribution of the group’s activities from a geographical standpoint is also an asset. The Santander banking group is in fact particularly well established in Europe and highly present on the markets in Portugal, Germany, Poland and Great Britain. It is also developing strongly into the United States and Brazil. Santander is equally one of the largest banking groups in South America. 

Another strength of the Santander Group lies in its capacity to ally itself with other large companies in this sector on an international level. These strong and strategic mergers and associations relate to companies that are renowned worldwide such as the Abu Dhabi Commercial Bank, the Polish bank Zachnodi WBK and Hutch Essar.

Finally, Santander boasts an excellent public image as it proposes a large range of quality services and products. In fact, due to this optimised service range Santander displays the importance it places on premier quality services and a healthy and trusting relationship with its clients. This is one of the major reasons for its success.

After reading this information it would be easy to think that Santander shares would certainly rise in value over the coming years but this notion should be moderated as we shall now explain.


The disadvantages and weak points of Santander shares as a stock market asset:

We have just reviewed the factual elements that influence the increase of the Santander share price on the stock market with the different advantages offered by this banking group. However, it would be remiss to ignore the negative aspects and weaknesses of this company. Here therefore are the major weak points of this group and the possible setbacks to this group’s progress.

Firstly, and despite the positive rise in the financial accounts of 2015 and 2016, we note that the 2017 objectives were not truly attained and the growth of this company’s activities in fact show signs of slowing down which is worrying for investors and shareholders and which weigh currently on the stock market.

On the other hand, the Santander Group still depends greatly on policy decisions taken by the Euro zone. The group still maintains its headquarters in Spain and achieves the vast majority of its income from within the European Union. It is therefore highly influenced by decisions taken by the Euro zone as by decisions taken by the Central European Bank.

We also regret, despite the consequential international development efforts, the fact that the Santander Group is not well positioned on the emerging markets. Its position, particularly in Asia, remains very weak compared to its major competitors who have in fact prioritised this market. The best implanted banks in this highly promising sector of countries such as India are currently Standard Chartered Bank, Barclays Bank and the RBS.

Finally, and as with other European banks, the Santander Group is subject to all the European restrictions and regulations in terms of financial asset management and is therefore required to restrict its debt to a minimum in order to reassure its investors and shareholders in general.

Finally, concerning this information on the weaknesses of Santander, it appears a little more risky to take long positions on the purchase of this share even though this does not mean that you should necessarily favour a bearish strategy, the aim being to create a medium term objective.


How to complete a good fundamental analysis of the Santander share price?

We recently examined how you can use the historical technical analysis data of the Santander share price to anticipate the future movements of this asset. But the historical charts are not the only means that you should use to anticipate future trends. In fact, a fundamental analysis is highly important here and you should take great care to integrate this highly valuable information as follows. 

Concerning the opportunities that could be available to Santander, we would pay careful attention to the development of the micro financing sector. Santander in fact tends to develop these services by offering adaptable financing to its lower income clients. This is the same for other services offered by Santander which consist of financial inclusion in generally underserved areas of the bank such as small businesses.  

Of course, all the mergers and acquisitions completed by Santander should be followed. This particularly concerns company acquisitions of which the headquarters is situated abroad and which could assist in the geographical development of this company. Of course, it is also important here to take into account the threats represented by the economic policies of these countries that can at times be extremely rigorous and strict and thereby weigh on the profitability of its financial operations.  

Banking activity is also directly linked to the world economic growth and this particularly concerns banks such as Santander, Therefore, when completing your fundamental analysis we recommend you carefully follow all the economic and financial data of the Euro zone as well as the countries or geographical zones where Santander is well established. 

The banking activity sector is also one of the most competitive. It is therefore primordial to integrate a complete study of the competition including the major competitors with your fundamental analysis, as detailed above, with financial information on each of them and their respective stock market situations in this sector.

Finally, you should of course monitor the movements of the interest rate for the Euro zone which remains one of the major threats as much for industry as for the banking sector. This threat has become more apparent since the recent Brexit problem. It is therefore important to closely monitor announcements and major publications by the ECB that you will find on the economic calendar of your online broker.

Now that you know the strengths and weaknesses of the Santander Company and the elements that need to be integrated in your fundamental analysis all you have to do to dive into this study and develop a coherent investment strategy. To do this you will of course need to use the economic and current events data but don’t forget to check the charts to assist you with technical signals that you can obtain and use to confirm, counter or balance your initial findings. It is only in this way that you can shrewdly anticipate and follow trends with strategies developed for the short, medium and long term.


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75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.