Santander(LSE: BNC) (NYSE: SAN.US) is no ordinary bank. While the company may be best known for its high-street presence and exposure to emerging market economies, theres more to the lender than meets the eye.
For example, a few weeks ago I coveredSantanders goal to branch out into the cloud storage market, taking on tech giants such asAmazonandIBM, as well as offering customers a secure location for digital storage.
And the bank is also building a presence in the renewable energy industry.
However, due to complexities of running an energy business and the regulatoryhurdles Santander would have to overcome in order to operate an energy business effectively, the bank isnt running these projects by itself.
Renewable energy giant
Over the past seven years, Santander has become one of the leading developers of renewables projects around the world. The bank has directly invested over $2bn in renewable energy and water projects.
Additionally, Santander offers assistance to other investors within the renewable energy industry. Services offered include financing, project management, installation andadministrative procedures for the life of the project.
But its the banks portfolio of renewable energy and water assets that is really interesting. Santander owns these assets in partnership with the Ontario Teachers Pension Plan and the Public Sector Pension Investment Board, two of Canadas largest pension funds, and the trio areplanning to invest billions in renewable energy projects over the coming years.
Santanders infrastructure assets arentjust limited to the companysrenewable energy and water projects. The banksAsset & Capital Structuring division, a team of 30 employees, specialises ininfrastructure equity investments and has built a global portfolio of assets spanningSpain, Italy, UK, US, Brazil and Mexico. According to Santander, this team manages the banks existing infrastructure investmentswhile keeping an eye out for further acquisitions.
All in all, a separate infrastructure division will only benefit Santander and the banks shareholders.
Indeed, unlike banking, which can be a complex and unpredictable business, infrastructure investing is relatively simple. Whats more, infrastructure assets usually produce a constant and predictable stream of income, giving Santander a financial cushion to fall back on during times of stress.
Best of breed
Santanders diversification is just one of the many reasons why the bank isone of the best investments in the financial sector, for me.
Moreover, at present levels Santanders shares appear to be undervalued. Santander currently trades at a forward P/E of around 13, and the banks earnings are forecast to expand at 13% to 14% per annum for the next two years. Santanders shares also support a dividend yield of 3.1%.
And if you’re also interested in Santander’s prospects then I strongly recommend that you take a closer look at the bank. To help you assess the company, our top analysts have put togetherthis new free report.
The report guidesyou through the seven key steps all successful investors follow before making an investment. And the report teaches you everything you need to know in under 20 minutes!
Don’t delay, this report is only available for a limited time. Soclick hereto download the free report today.
The Hidden True Story Behind This Black Sheep Stock!
This controversial British retail tycoon is unloved by the city and even his own shareholders.
But behind the media headlines, his company is about to make a daring global e-commerce play that could take many people by surprise
and may make savvy investors who get on-board now very rich in the years ahead.
Read on to discover THREE hidden factors that we believe make this one of your most potentially lucrative investments of 2015!