Yahoo Finance Should Value Investors Buy Banco Santander (SAN) Stock?
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company value investors might notice is Banco Santander (SAN). SAN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 5.31. This compares to its industry's average Forward P/E of 7.17. Over the past year, SAN's Forward P/E has been as high as 7 and as low as 4.19, with a median of 5.29.
Investors should also recognize that SAN has a P/B ratio of 0.52. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.47. Within the past 52 weeks, SAN's P/B has been as high as 0.66 and as low as 0.37, with a median of 0.48.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. SAN has a P/S ratio of 1. This compares to its industry's average P/S of 1.31.
Finally, investors will want to recognize that SAN has a P/CF ratio of 4.36. 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. SAN's current P/CF looks attractive when compared to its industry's average P/CF of 11.65. Within the past 12 months, SAN's P/CF has been as high as 5.31 and as low as 3.04, with a median of 3.83.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Banco Santander is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SAN feels like a great value stock at the moment.
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Banco Santander, S.A. (SAN) : Free Stock Analysis Report
