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Is Banco Macro (BMA) Stock Undervalued Right Now?

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·3 min read
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company to watch right now is Banco Macro (BMA). BMA is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We should also highlight that BMA has a P/B ratio of 0.60. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.38. Within the past 52 weeks, BMA's P/B has been as high as 3.58 and as low as 0.55, with a median of 1.19.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BMA has a P/S ratio of 0.35. This compares to its industry's average P/S of 0.93.

Finally, investors should note that BMA has a P/CF ratio of 6.99. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 14.74. Over the past year, BMA's P/CF has been as high as 7.73 and as low as 4.22, with a median of 5.95.

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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