Key Takeaways
- Milan-listed UniCredit is fiercely pursuing Germany’s Commerzbank as part of its strategy of cross-border growth and Europe-wide consolidation.
- Morningstar senior analyst Johann Scholtz rates CEO Andrea Orcel’s overhaul from “perennial underperformer” to one of Europe’s most profitable banks.
- However, concerns remain over the firm’s “persistent appetite” for high-profile M&A and the potential for an Italian windfall tax.
Italy’s UniCredit UCG is on a mission to reshape Europe’s banking landscape.
The Milan-listed lender is in fierce pursuit of Germany’s Commerzbank CBK, with fresh hopes to seize control by early 2027. Its maneuvering around Italy’s Banco BPM BAMI has begun anew. And its expanded stake in Greece’s Alpha Bank ALPHA shows raw appetite for regional growth.
Shares of the Italian bank are up 17% so far this year—and almost 900% higher since CEO Andrea Orcel took the helm in April 2021, setting out on his agenda of cross-border growth and Europe-wide consolidation. So, what is driving UniCredit’s stock?
What’s Driving UniCredit Shares Higher?
UniCredit has been on a course to boost profitability over the past several years amid its growth push. Second quarter earnings beat expectations, as falling costs and strong net fees boosted profits to EUR 2.9 billion. The bank now expects 2026 income “well above” EUR 11 billion.
Morningstar senior analyst Johann Scholtz says UniCredit’s transformation over the past two years from “a perennial underperformer to one of the most profitable banks in Europe has been astounding.”
He credits the bank for now comfortably generating high-double-digit returns, with particular strength in its Italian retail banking operations. Still, he flags concerns over its “persistent appetite” for high-profile M&A. So can the stock push higher in 2026?
Can UniCredit’s Stock Continue to Climb?
UniCredit’s stock is trading around EUR 84 a share. That’s roughly in line with Morningstar’s fair value estimate of EUR 88.
Scholtz says the estimate corresponds to 2.3 times 2026 tangible book value and 12 times projected 2026 earnings. Nevertheless, he maintains a high uncertainty rating for the stock due to its ongoing pursuit of Commerzbank, and threats of a windfall tax for Italian banks.
Third quarter results in late-October will give a fresh read on the bank’s path ahead. But for now, the stock appears fairly valued. For Morningstar, I’m Karen Gilchrist.
