Monte Paschi CEO Ousted, Mediobanca Merger Risk Rises

This CEO upheaval follows recent share price weakness, with a 30-day decline of 6.21% and a 90-day decline of 16.69%, contrasting with a strong 3-year total shareholder return. Simply Wall St's "Most Popular Narrative" indicates BMPS is 23.6% undervalued with a fair value of €9.96, based on optimistic merger synergies with Mediobanca.

This narrative acknowledges long-term structural pressures like regulatory tightening and scale disadvantages. However, Simply Wall St's Discounted Cash Flow (DCF) model estimates a fair value of €5.71 per share, suggesting the current €7.606 price is overvalued by this metric.

The discrepancy highlights investor uncertainty regarding the bank's future, particularly the success of Mediobanca integration and its ability to achieve cost synergies and earnings growth. Sustained gains in asset quality and a strong 19.6% CET1 ratio support higher payouts or value-accretive deals.