Is First BanCorp. (FBP) Stock Undervalued Right Now?
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...
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 First BanCorp. (FBP). FBP is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 9.14, which compares to its industry's average of 11.80. Over the past 52 weeks, FBP's Forward P/E has been as high as 11.80 and as low as 8.45, with a median of 9.90.
Investors will also notice that FBP has a PEG ratio of 0.24. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. FBP's industry has an average PEG of 0.59 right now. Over the past 52 weeks, FBP's PEG has been as high as 0.80 and as low as 0.24, with a median of 0.28.
Investors should also recognize that FBP has a P/B ratio of 1.22. The P/B is a method of comparing a stock's market value to 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 1.72. Over the past year, FBP's P/B has been as high as 1.42 and as low as 0.87, with a median of 1.22.
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. FBP has a P/S ratio of 2.98. This compares to its industry's average P/S of 3.11.
Finally, we should also recognize that FBP has a P/CF ratio of 8.79. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.42. FBP's P/CF has been as high as 19.09 and as low as 8.79, with a median of 12.15, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that First BanCorp. Is likely undervalued currently. And when considering the strength of its earnings outlook, FBP sticks out at as one of the market's strongest value stocks.
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