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Is Banco Do Brasil (BDORY) Stock Undervalued 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Do Brasil (BDORY - Free Report) . BDORY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

Investors should also recognize that BDORY has a P/B ratio of 0.71. 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 1.50. BDORY's P/B has been as high as 0.80 and as low as 0.54, with a median of 0.68, over the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. 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 0.54. This compares to its industry's average P/S of 1.44.

Finally, investors will want to recognize that BDORY has a P/CF ratio of 3.70. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. BDORY's P/CF compares to its industry's average P/CF of 14.03. Over the past year, BDORY's P/CF has been as high as 5.12 and as low as 2.80, with a median of 3.87.

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


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