July 25, 2024
Top 10 Stock BancorpSouth Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: BancorpSouth – Top 10 Stock in Dow Jones U.S. Regional Banks Index
BancorpSouth is listed as a top 10 stock on July 25, 2024 in the market index D.J. US Banks because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 63 (high 63% performer), Obermatt assesses an overall buy recommendation for BancorpSouth on July 25, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Regional Banks |
| Index | Dividends USA, D.J. US Banks, S&P MIDCAP |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View BancorpSouth Buy
| 360 METRICS | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 51 |
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| SENTIMENT | ||||||||
| SENTIMENT | 28 |
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| 360° VIEW | ||||||||
| 360° VIEW | 63 |
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ANALYSIS: With an Obermatt 360° View of 63 (better than 63% compared with alternatives), overall professional sentiment and financial characteristics for the stock BancorpSouth are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for BancorpSouth. The consolidated Growth Rank has a good rank of 97, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is higher than for 97% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 51 which means that the company has a financing structure that is safer than 51% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 42 which means that the share price of BancorpSouth is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 58% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 28, which means that professional investors are more pessimistic about the stock than for 72% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 63, BancorpSouth is better positioned than 63% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 97), and the company is safely financed (Safety Rank of 51). However, professional market sentiment is low(Sentiment Rank of 28). The negative market view on BancorpSouth may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of BancorpSouth compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for BancorpSouth only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 28 (better than 28% compared with alternatives), overall professional sentiment and engagement for the stock BancorpSouth is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for BancorpSouth. Analyst Opinions are at a rank of 40 (worse than 60% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 32, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 53, which means that professional investors hold more stock in this company than in 53% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 52, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 52% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to BancorpSouth and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 28 (less encouraging than 72% compared with investment alternatives), BancorpSouth has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: BancorpSouth Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 42 (worse than 58% compared with alternatives), BancorpSouth shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for BancorpSouth. Price-to-Sales (P/S) is 50, which means that the stock price compared with what market professionals expect for future sales is lower than for 50% of comparable companies, indicating a good value concerning BancorpSouth's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 52, which means that dividends are expected to be higher than for 52% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 59% of alternatives (only 41% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 61% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 42, is a hold recommendation based on BancorpSouth's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. ...read more
Growth Strategy: BancorpSouth Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2024, BancorpSouth shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for BancorpSouth. Profit Growth has a rank of 87 which means that currently professionals expect the company to grow its profits more than 87% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 83, and Stock Returns has a rank of 86 which means that the stock returns have recently been above 86% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 41 (59% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: BancorpSouth Debt Financing Safety above-average
| SAFETY METRICS | July 25, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 10 |
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| REFINANCING | ||||||||
| REFINANCING | 66 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 72 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 51 |
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ANALYSIS: With an Obermatt Safety Rank of 51 (better than 51% compared with alternatives), the company BancorpSouth has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of BancorpSouth is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for BancorpSouth. Refinancing is at 66, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 66% of its competitors. Liquidity is also good at 72, meaning the company generates more profit to service its debt than 72% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 10, which means the company has an above-average debt-to-equity ratio. It has more debt than 90% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 51 (better than 51% compared with alternatives), BancorpSouth has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and BancorpSouth could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: BancorpSouth Top Financial Performance
| COMBINED PERFORMANCE | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 72 |
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| COMBINED | ||||||||
| COMBINED | 79 |
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ANALYSIS: With an Obermatt Combined Rank of 79 (better than 79% compared with investment alternatives), BancorpSouth (Regional Banks, USA) shares have much better financial characteristics than comparable stocks. Shares of BancorpSouth are low in value (priced high) with a consolidated Value Rank of 42 (worse than 58% of alternatives). But they show above-average growth (Growth Rank of 97) and are safely financed (Safety Rank of 51, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 79, is a strong buy recommendation based on BancorpSouth's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company BancorpSouth exhibits low value (Obermatt Value Rank of 42), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 97). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 51) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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