Back to top

Is Popular (BPOP) Stock Undervalued Right Now?

Read MoreHide Full Article

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company to watch right now is Popular (BPOP - Free Report) . BPOP is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 9.16. This compares to its industry's average Forward P/E of 11.14. Over the past year, BPOP's Forward P/E has been as high as 14.80 and as low as 8.96, with a median of 9.66.

Another valuation metric that we should highlight is BPOP's P/B ratio of 1.05. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.75. Within the past 52 weeks, BPOP's P/B has been as high as 1.11 and as low as 0.67, with a median of 0.94.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. BPOP has a P/S ratio of 2.15. This compares to its industry's average P/S of 3.04.

Finally, our model also underscores that BPOP has a P/CF ratio of 12.80. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. BPOP's current P/CF looks attractive when compared to its industry's average P/CF of 12.93. Over the past year, BPOP's P/CF has been as high as 34.34 and as low as 11.75, with a median of 16.42.

These are only a few of the key metrics included in Popular'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, BPOP looks like an impressive value stock at the moment.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Popular, Inc. (BPOP) - free report >>

More from Zacks Tale of the Tape

You May Like

Published in