Should Value Investors Buy Banco Bilbao Viscaya Argentaria (BBVA) Stock?

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Banco Bilbao Viscaya Argentaria (BBVA). BBVA is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 9.5, while its industry has an average P/E of 10.76. Over the last 12 months, BBVA's Forward P/E has been as high as 9.83 and as low as 5.63, with a median of 7.70.

We should also highlight that BBVA has a P/B ratio of 1.63. 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 stock's P/B looks attractive against its industry's average P/B of 2.72. Within the past 52 weeks, BBVA's P/B has been as high as 1.63 and as low as 0.85, with a median of 1.24.

Finally, our model also underscores that BBVA has a P/CF ratio of 8.79. 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. BBVA's current P/CF looks attractive when compared to its industry's average P/CF of 18.45. Within the past 12 months, BBVA's P/CF has been as high as 8.79 and as low as 4.56, with a median of 6.19.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Banco Bilbao Viscaya Argentaria is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BBVA feels like a great value stock at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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