Banco Macro SA: Strong price momentum but will it sustain?

Banco Macro SA relative valuation is OVERVALUED and it has a fundamental analysis score of 54.

Our analysis is based on comparing Banco Macro SA with the following peers – BBVA Banco Frances SA Sponsored ADR, Grupo Financiero Galicia SA Sponsored ADR Class B, Banco Santander-Chile Sponsored ADR, Banco Santander S.A. Sponsored ADR, Citigroup Inc and Banco Santander Rio SA Class B (BFR-US, GGAL-US, BSAC-US, SAN-US, C-US and BRIO-AR).

Banco Macro SA has shown good performance overall, both over the last one year (at 27.05%) as well as over the last month (at 7.26%). Share price performance over the last month, though has been lower than that over the last year. But Banco Macro SA’s stock has done better than its overall peer group whose performance was 1.75% over the last month.

Company Snapshot

  • From a peer analysis perspective, relative outperformance last month is up from a median performance last year.
  • It’s current Price/Book of 2.95 is about median in its peer group.
  • The market expects BMA-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.
  • BMA-US‘s relative capital efficiency and net profit margins are both around the median level.
  • Changes in annual revenues are in line with its chosen peers but lags in terms of earnings suggesting that the company is less cost conscious and may be spending for growth.
  • BMA-US‘s return on equity currently and over the past five years is around the peer median and suggest that it does not have any particular operational advantages versus peers.
  • While the company’s lending operations do not seem to benefit from any relative pricing advantage its margins suggest relatively low operating costs.
  • While BMA-US‘s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company’s equity capital investment seems appropriate for a business with peer median returns.
  • Our analysis rates Banco Macro SA as OVERVALUED relative to its peers.

Share Price Performance

From a peer analysis perspective, relative outperformance last month is up from a median performance last year.

While BMA-US‘s change in share price of 27.05% for the last 12 months is in line with its peer median, its more recent 30-day share price performance of 7.26% is above the peer median. This suggests the company’s performance has improved more recently relative to peers.

Share Price Performance

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Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Banco Macro SA’s price of USD 96.61 is greater than CapitalCube’s implied price of USD 62.99. At this level, CapitalCube believes that Banco Macro SA is overvalued. Over the last 52 week period, the stock has fluctuated between USD 61.12 and USD 97.86.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Banco Macro SA engages in the provision of financial and banking services. It operates through the Retail Banking and Corporate Banking segments. It also offers savings, checking accounts, time deposits, fund management, loans, mortgages, and direct banking transactions. The company was founded on November 21, 1966 and is headquartered in Buenos Aires, Argentina.

Disclaimer

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