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BMA vs. BSAC: Which Stock Is the Better Value Option?

Zacks Equity Research
Sierra Bancorp (BSRR) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Investors with an interest in Banks - Foreign stocks have likely encountered both Banco Macro (BMA) and Banco Santander-Chile (BSAC). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Banco Macro and Banco Santander-Chile are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that BMA's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

BMA currently has a forward P/E ratio of 7.97, while BSAC has a forward P/E of 14.90. We also note that BMA has a PEG ratio of 0.58. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BSAC currently has a PEG ratio of 1.15.

Another notable valuation metric for BMA is its P/B ratio of 2.38. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, BSAC has a P/B of 3.21.

These are just a few of the metrics contributing to BMA's Value grade of A and BSAC's Value grade of D.

BMA has seen stronger estimate revision activity and sports more attractive valuation metrics than BSAC, so it seems like value investors will conclude that BMA is the superior option right now.


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Macro Bank Inc. (BMA) : Free Stock Analysis Report
 
Banco Santander Chile (BSAC) : Free Stock Analysis Report
 
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