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Are Investors Undervaluing Banco Santander-Brazil (BSBR) Right Now?

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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.

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 stock to keep an eye on is Banco Santander-Brazil (BSBR - Free Report) . BSBR is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.

Investors will also notice that BSBR has a PEG ratio of 0.86. 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. BSBR's PEG compares to its industry's average PEG of 1.09. Over the past 52 weeks, BSBR's PEG has been as high as 1.22 and as low as 0.71, with a median of 0.97.

Finally, investors will want to recognize that BSBR has a P/CF ratio of 11.66. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. BSBR's P/CF compares to its industry's average P/CF of 12.21. BSBR's P/CF has been as high as 13.63 and as low as 7.69, with a median of 11.25, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Banco Santander-Brazil is likely undervalued currently. And when considering the strength of its earnings outlook, BSBR sticks out at as one of the market's strongest value stocks.


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