April 18, 2024
Top 10 Stock BBVA 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: BBVA – Top 10 Stock in Mercado de Valores de Buenos Aires Index MERVAL
BBVA is listed as a top 10 stock on April 18, 2024 in the market index MERVAL because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 55 (high 55% performer), Obermatt assesses an overall buy recommendation for BBVA on April 18, 2024.
Snapshot: Obermatt Ranks
| Country | Argentina |
| Industry | Diversified Banks |
| Index | MERVAL, Human Rights, Independent Boards Growth Markets |
| 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 BBVA Buy
| 360 METRICS | April 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 35 |
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| GROWTH | ||||||||
| GROWTH | 83 |
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| SAFETY | ||||||||
| SAFETY | 43 |
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| SENTIMENT | ||||||||
| SENTIMENT | 37 |
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| 360° VIEW | ||||||||
| 360° VIEW | 55 |
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ANALYSIS: With an Obermatt 360° View of 55 (better than 55% compared with alternatives), overall professional sentiment and financial characteristics for the stock BBVA are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for BBVA. The consolidated Growth Rank has a good rank of 83, 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. It ranks higher than 83% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 35 means that the share price of BBVA is on the high side compared with its peers regarding revenues, profits, and invested capital. The stock price is higher than for 65% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 43, which means that the company has a riskier financing structure than 57% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 37, indicating professional investors are more pessimistic about the stock than for 63% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 55, BBVA is better positioned than 55% of all alternative stock investment opportunities based on the Obermatt Method. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 83), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 37), the company is rather risky when it comes to financing (Safety Rank of 43). The negative market view on BBVA 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 join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of BBVA compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one 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 (even though it is lower than 50). As market sentiment is critical, 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 BBVA only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 37 (better than 37% compared with alternatives), overall professional sentiment and engagement for the stock BBVA is below industry average.
RECOMMENDATION: With a consolidated Sentiment Rank of 37 (less encouraging than 63% compared with investment alternatives), BBVA has a reputation among professional investors that is below that of its competitors.
Value Strategy: BBVA Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 35 (worse than 65% compared with alternatives), BBVA shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for BBVA. Price-to-Sales (P/S) is 92, which means that the stock price compared with what market professionals expect for future sales is lower than 92% of comparable companies, indicating a good value concerning to BBVA's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 1, meaning that dividends are expected to be lower than for 99% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 66% of alternatives (only 34% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 70% 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 35, is a hold recommendation based on BBVA's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in BBVA could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, BBVA looks like an expensive investment today. ...read more
Growth Strategy: BBVA Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 83 (better than 83% compared with alternatives) for 2024, BBVA 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 BBVA. Sales Growth has a rank of 99 which means that currently, professionals expect the company to grow more than 99% of its competitors. Both Profit Growth, with a rank of 83, and Stock Returns, with a rank of 100, are also above average. But Capital Growth only has a rank of 1, which means that, currently, professionals expect the company to grow its invested capital less than 99% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 83, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. ...read more
Safety Strategy: BBVA Debt Financing Safety below-average
| SAFETY METRICS | April 18, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 93 |
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| REFINANCING | ||||||||
| REFINANCING | 53 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 6 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 43 |
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ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company BBVA has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of BBVA is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for BBVA.Leverage is at 93, meaning the company has a below-average debt-to-equity ratio. It has less debt than 93% of its competitors.Refinancing is at a rank of 53, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 53% of its competitors. Liquidity is at 6, meaning that the company generates less profit to service its debt than 94% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 43 (worse than 57% compared with alternatives), BBVA has a financing structure that is riskier than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: BBVA Above-Average Financial Performance
| COMBINED PERFORMANCE | April 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 35 |
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| GROWTH | ||||||||
| GROWTH | 83 |
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| SAFETY | ||||||||
| SAFETY | 6 |
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| COMBINED | ||||||||
| COMBINED | 69 |
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ANALYSIS: With an Obermatt Combined Rank of 69 (better than 69% compared with investment alternatives), BBVA (Diversified Banks, Argentina) shares have above-average financial characteristics compared with similar stocks. Shares of BBVA are low in value (priced high) with a consolidated Value Rank of 35 (worse than 65% of alternatives), and are riskily financed (Safety Rank of 43, which means above-average debt burdens) but show above-average growth (Growth Rank of 83). ...read more
RECOMMENDATION: A Combined Rank of 69, is a buy recommendation based on BBVA's financial characteristics. As the company BBVA shows low value with an Obermatt Value Rank of 35 (65% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 83% of comparable companies (Obermatt Growth Rank is 83). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 43 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for BBVA, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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