Back to top

Image: Bigstock

Should Value Investors Buy Credicorp (BAP) Stock?

Read MoreHide Full Article

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 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 Credicorp (BAP - Free Report) . BAP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 6.57, while its industry has an average P/E of 6.84. Over the past year, BAP's Forward P/E has been as high as 9.38 and as low as 6.53, with a median of 7.87.

Investors should also note that BAP holds a PEG ratio of 0.49. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. BAP's PEG compares to its industry's average PEG of 0.55. Over the last 12 months, BAP's PEG has been as high as 0.59 and as low as 0.36, with a median of 0.43.

Investors should also recognize that BAP has a P/B ratio of 1.20. 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. BAP's current P/B looks attractive when compared to its industry's average P/B of 1.41. Within the past 52 weeks, BAP's P/B has been as high as 1.83 and as low as 1.19, with a median of 1.40.

Finally, our model also underscores that BAP has a P/CF ratio of 6.53. 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. BAP's P/CF compares to its industry's average P/CF of 11.38. BAP's P/CF has been as high as 8.64 and as low as 6.48, with a median of 7.75, all within the past year.

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


See More Zacks Research for These Tickers


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


Credicorp Ltd. (BAP) - free report >>

Published in