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Is Banco Macro (BMA) Stock Undervalued Right Now?

Zacks Equity Research

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company value investors might notice is Banco Macro (BMA). BMA is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 7.69 right now. For comparison, its industry sports an average P/E of 10. Over the last 12 months, BMA's Forward P/E has been as high as 8.57 and as low as 3.37, with a median of 5.67.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BMA has a P/S ratio of 1.58. This compares to its industry's average P/S of 1.87.

Finally, our model also underscores that BMA has a P/CF ratio of 7.11. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. BMA's current P/CF looks attractive when compared to its industry's average P/CF of 15.53. Within the past 12 months, BMA's P/CF has been as high as 7.90 and as low as 3.53, with a median of 4.99.

These are just a handful of the figures considered in Banco Macro's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that BMA is an impressive value stock right now.


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