BBVA's Execution Still Overshadowed By Macro Worries And Rate Pressure

I wasn’t particularly keen on BBVA (BBVA) shares back in December, due to a combination of both macro challenges in markets like Mexico, Spain, Turkey, and the U.S., as well as some internal execution/value-creation issues. Since then, the shares have kept pace with other European banks, but are still down slightly.

BBVA shares do appear to offer some value here, but lower rates in Europe and the U.S. aren’t going to do the bank any favors, and there are likewise worries about an upcoming lowering cycle in Mexico. Moreover, not unlike ING (ING) and SocGen (OTCPK:SCGLY) the prospects for meaning near-term earnings growth look poor, and BBVA seems unlikely to earn its cost of equity anytime soon – all of which is bad for sentiment and relative performance. I can see some value-hunting appeal here, but I’d at least consider some other quality European bank names like ING and the Nordics (Danske, DNB, Nordea, and Swedbank) as part of the due diligence process.

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BBVA's Execution Still Overshadowed By Macro Worries And Rate Pressure