Zenith Bank Price Target Sets at N81 after Q3 Earnings
Reflecting a positive upside potential of about 30%, investment firm AAG Capital Limited has set N81 as the target price for Zenith Bank Plc following a third quarter of 2025 earnings release.
Data from the Nigerian Exchange (NGX) showed Zenith Bank share price closed at N63, which translates to 29% upside potential at the reference price.
With its higher net asset value compared with stock market price, analysts told MarketForces Africa that Zenith Bank is grossly undervalued. Net asset of Zenith Bank surged by 34.8% to N4.730 trillion from N3.508 trillion in the equivalent period in 2024.
The Nigerian Exchange valued Zenith Bank Plc.’s 41.069 billion shares outstanding for N2.587 trillion, trading at significant discount to its 52-week high.
According to its unaudited financial statement for 9M-2025, Zenith Bank’s gross earnings grew by 16.3% year on year to ₦3.37 trillion, primarily driven by higher interest income in the period.
The bank’s interest income increased by 40.8% year on year on the back of improved interest from Treasury bills, loans to customers and Government and other bonds, sustained by the high-yield and interest rate environment.
Interest income from Treasury bills investment surged by 74.4% year on year to N740.50 billion, income from loans surged by 27% to N1.36 trillion and government bonds delivered 36.5% surge in income to N400.28 billion.
On funding side, interest expenses increased by 22.2% year on year to ₦814.23 billion driven by interest on deposits. As a result, annualized Cost of Fund (CoF) edged up to 4.5% from 3.7%, the previous period.
Overall, Net interest income climbed 50.4% year on year to ₦1.93trn in its 9M 2025 result while the annualized Net Interest Margin (NIM) improved to 8.6% from 5.9%, the previous period.
Non-Interest Income declined by 33.8% YoY to ₦630.88 billion, an offshoot of a 59.5% year on year decline in trading income.
Meanwhile, fees and commission income grew by 10.5% YoY, due to notable improvement from foreign currency transaction fees and commission, commission on letters of credit, income from financial guarantee contracts issued and account maintenance fee.
Operating Expenses (OPEX) increased by 12.7% YoY to ₦532.12bn, driven by AMCON levy, Personnel expenses, Information technology, Telephone, postage and communication and Deposit insurance premium. Due to the higher operating expenses amid lower net non-income, Cost to Income ratio (CIR) increased slightly by 30bps to 31.0%.
Total Impairment Charge increased by 63.6% to ₦781.52 billion from ₦477.77 billion in the same period in 2024. The group reported Loan Impairment Charge of ₦810.51 billion, bringing the 9M 2025 cost of risk (COR) to 8.1% from 4.2% in the same period in 2024.
Zenith Bank’s pre-tax profit declined by 8.5% year on year to ₦917.41 billion, while profit after tax declined 7.6% year on year to ₦764.20 billion in 9M 2025 bringing the annualised post-tax return on equity (ROE )to 21.5%. GCR Keeps FBNQuest Merchant Bank Outlook on Rating Watch Negative
