Are Investors Undervaluing Banco Do Brasil (BDORY) Right Now?

BDORY

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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Banco Do Brasil (BDORY - Free Report) is a stock many investors are watching right now. BDORY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 4.45, while its industry has an average P/E of 8.18. Over the last 12 months, BDORY's Forward P/E has been as high as 4.57 and as low as 1.86, with a median of 3.72.

Another valuation metric that we should highlight is BDORY's P/B ratio of 1. Investors use the P/B ratio to look at a stock's market value versus 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 1.53. BDORY's P/B has been as high as 1 and as low as 0.64, with a median of 0.82, over the past year.

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. BDORY has a P/S ratio of 0.7. This compares to its industry's average P/S of 1.16.

Finally, investors will want to recognize that BDORY has a P/CF ratio of 4.72. 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. BDORY's P/CF compares to its industry's average P/CF of 12.15. BDORY's P/CF has been as high as 4.72 and as low as 3.11, with a median of 3.89, all within the past year.

These are only a few of the key metrics included in Banco Do Brasil's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, BDORY looks like an impressive value stock at the moment.

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