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Is Grupo Financiero Galicia (GGAL) a Great Value Stock Right Now?

Zacks Equity Research
·3 min read

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Grupo Financiero Galicia (GGAL). GGAL is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.

Investors should also note that GGAL holds a PEG ratio of 0.59. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GGAL's PEG compares to its industry's average PEG of 1.53. Within the past year, GGAL's PEG has been as high as 0.67 and as low as 0.46, with a median of 0.61.

Investors should also recognize that GGAL has a P/B ratio of 0.50. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.38. Over the past 12 months, GGAL's P/B has been as high as 3.17 and as low as 0.35, with a median of 0.98.

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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. GGAL has a P/S ratio of 0.48. This compares to its industry's average P/S of 1.14.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Grupo Financiero Galicia is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GGAL feels like a great value stock at the moment.


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Zacks Investment Research