Showing posts with label Creditcorp. Show all posts
Showing posts with label Creditcorp. Show all posts
Tuesday, October 25, 2016
Credicorp Still A Leader In A Growing, Under-Served Market
Peru isn't on the radar of many investors, perhaps in part because it is still a smaller, mining-dominated economy and also because there aren't many liquid ADRs to follow. Whatever the case, Credicorp (NYSE:BAP) continues to look like a rare asset - a responsible, well-run Peruvian bank with good market share and yet still good growth potential given the size of the under-served Peruvian market.
These shares have done alright since my last favorable write-up, climbing almost 20% as the company has continued to do a solid job growing its business. Although I do believe Credicorp's ROE is likely to shrink in the future as the Peruvian economy matures and rivals like the Peruvian operations of BBVA (NYSE:BBVA) and Bank of Nova Scotia (NYSE:BNS) compete harder for business, I'm still looking for long-term earnings growth of over 10% on an annualized basis, supporting a fair value of over $160/share today.
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Credicorp Still A Leader In A Growing, Under-Served Market
Sunday, March 13, 2016
Seeking Alpha: Credicorp Generating Good Results In An Underserved Market
I was pretty down on Credicorp (NYSE:BAP) shares back in May of 2015, as I didn't think the shares offered enough upside
to offset the risk. While the company has done pretty well on an
operating basis since then, the shares are down about 10% since that
last article and have more or less tracked the movement of the Peruvian
nuevo sol versus the dollar.
I continue to have mixed feelings about Credicorp. I think this is a pretty well-run emerging market bank, and I like the company's leadership in a growing under-banked market. I don't like the company's heavy reliance on the Peruvian central bank to subsidize the de-dollarization process (moving from dollar-denominated loans and deposits to PEN-denominated), and I have some modest concerns about the level of reserves. I think the shares are about 10% to 15% undervalued even after incorporating a higher cost of capital, so it's not a clear-cut buy to me right now.
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Credicorp Generating Good Results In An Underserved Market
I continue to have mixed feelings about Credicorp. I think this is a pretty well-run emerging market bank, and I like the company's leadership in a growing under-banked market. I don't like the company's heavy reliance on the Peruvian central bank to subsidize the de-dollarization process (moving from dollar-denominated loans and deposits to PEN-denominated), and I have some modest concerns about the level of reserves. I think the shares are about 10% to 15% undervalued even after incorporating a higher cost of capital, so it's not a clear-cut buy to me right now.
Read more:
Credicorp Generating Good Results In An Underserved Market
Tuesday, May 28, 2013
Investopedia: Scotiabank's Balanced Model Continues To Deliver
Each of the Canadian Big Five banks has its own strategy to diversify
its growth outside of the Canadian banking market. In the case of Bank Of Nova Scotia (“Scotiabank”) (NYSE:BNS),
that strategy revolves around building its high-growth Latin American
banking business and it's less appreciated (but still lucrative) wealth
management operations. Although investors should not underestimate the
risk of a banking slowdown in Canada nor the inherent risks of emerging
market banking, Scotiabank looks as though it may be a relative bargain
in the banking sector.
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http://www.investopedia.com/stock-analysis/052813/scotiabanks-balanced-model-continues-deliver-bns-c-bmo-bap-san-cm-n.aspx
Please continue here:
http://www.investopedia.com/stock-analysis/052813/scotiabanks-balanced-model-continues-deliver-bns-c-bmo-bap-san-cm-n.aspx
Thursday, April 12, 2012
Investopedia: Peru's Under-Banked Market is Fueling Creditcorp's Growth
With bank branches blanketing the United States, Canada and most of Western Europe, and seemingly everyone holding some sort of debt, it seems hard to imagine what an under-banked market might look like. Look no further than Peru, then, where significant economic growth and increasing penetration of retail banking services is driving a great growth story for Credicorp (NYSE:BAP).
What's Under-Banked Mean?
There's ample room to argue about what the "right" level of banking activity in a country is and the best way to measure it. For sake of simplicity, I'm going with loan-to-GDP. In developed countries, that ratio is 137%. In Chile, which in many respects is the most "European" of South American countries, the ratio is 86%, while the ratio drops to 57% in Brazil.
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What's Under-Banked Mean?
There's ample room to argue about what the "right" level of banking activity in a country is and the best way to measure it. For sake of simplicity, I'm going with loan-to-GDP. In developed countries, that ratio is 137%. In Chile, which in many respects is the most "European" of South American countries, the ratio is 86%, while the ratio drops to 57% in Brazil.
Please follow this link for more:
http://stocks.investopedia.
Thursday, October 20, 2011
Investopedia: Citigroup On The Mend ... Slowly
It's just a fact of life that it's easier and faster to destroy than it is to rebuild. To that end, Citigroup (NYSE:C) has certainly been a frustrating stock to hold this year as the stock had been nearly cut in half before a recent rally. While this huge bank's third quarter earnings continue to point to progress, the reality is that Citigroup is still a long way from normal, and shareholders have to be content with more short-term disappointment if they want to see the long-term value play out.
Decent Third Quarter Results
Although analysts had been marking down their expectations, going into this quarter, Citi didn't do too badly. Adjusted core revenue fell 2% on a sequential basis, as modest growth in regional consumer banking (2%) and decent growth in transaction services (7%) was offset by declines in securities and banking 12%. For whatever reason, it helps shareholders, this performance is likely to be the rule for other large banks like Bank of America (NYSE:BAC) (BofA) as well.
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Decent Third Quarter Results
Although analysts had been marking down their expectations, going into this quarter, Citi didn't do too badly. Adjusted core revenue fell 2% on a sequential basis, as modest growth in regional consumer banking (2%) and decent growth in transaction services (7%) was offset by declines in securities and banking 12%. For whatever reason, it helps shareholders, this performance is likely to be the rule for other large banks like Bank of America (NYSE:BAC) (BofA) as well.
To read more, click below:
http://stocks.investopedia.
Tuesday, July 19, 2011
Investopedia: Citi Still Healing
The best thing that might be said about Citigroup's (NYSE:C) second quarter is that expectations for large banks had turned so sour going into July that it did not take much for this still-struggling bank to produce a little relief with its results. The problem with Citi is the same as it has been for a while - the bank is going to need time to heal. That means near-term momentum will be lacking, but the long-term prospects suggest there is some value here.
A Morass of Numbers for Q2
It would be easy to write at great length about the various parts of Citi and how they performed this quarter. In lieu of that, here is a quick summary of some of the most salient takeaways. First, while total company revenue was up 5% sequentially (and down 7% from last year), the parts of the business that management intends to keep saw revenue fall 1% on both a sequential and annual comparison.
To read the full article, please click below:
http://stocks.investopedia.
A Morass of Numbers for Q2
It would be easy to write at great length about the various parts of Citi and how they performed this quarter. In lieu of that, here is a quick summary of some of the most salient takeaways. First, while total company revenue was up 5% sequentially (and down 7% from last year), the parts of the business that management intends to keep saw revenue fall 1% on both a sequential and annual comparison.
To read the full article, please click below:
http://stocks.investopedia.
Friday, June 3, 2011
Investopedia: Peru's Big Decision
Elections matter in almost every economy, but maybe even more so in Latin America. Several once-promising growth stories have been all but erased in the wake of elections that brought in who promised equality, but delivered little more than shared misery and more corruption. Venezuela is perhaps the best recent example, though there are others. Right now, investors are fretting over what this weekend's election in Peru may hold for the country, its citizens and investors.
More of the Same or a Turn to the Left?
The June 5 election in Peru has come down to a very close contest between Keiko Fujimori and Ollanta Humala. Ms. Fujimori's platform basically represents a "more of the same" continuation of existing policies; policies that have brought a lot of growth to Peru and considerably more economic stability.
Ollanta Humala is more of an unknown quality. A former military officer, Humala fought against Peru's Shining Path (a Maoist insurgency), but also led an unsuccessful military revolt against the government of Alberto Fujimori - Keiko's father and a former President of Peru now in jail for a host of crimes committed during his administration.
To read the complete piece, please click below:
http://stocks.investopedia.
More of the Same or a Turn to the Left?
The June 5 election in Peru has come down to a very close contest between Keiko Fujimori and Ollanta Humala. Ms. Fujimori's platform basically represents a "more of the same" continuation of existing policies; policies that have brought a lot of growth to Peru and considerably more economic stability.
Ollanta Humala is more of an unknown quality. A former military officer, Humala fought against Peru's Shining Path (a Maoist insurgency), but also led an unsuccessful military revolt against the government of Alberto Fujimori - Keiko's father and a former President of Peru now in jail for a host of crimes committed during his administration.
To read the complete piece, please click below:
http://stocks.investopedia.
Tuesday, March 1, 2011
Investopedia: HSBC Faces A Longer Road Back To Normal
With operations in 87 countries and every major region of the world, HSBC (NYSE:HBC) basically is world banking, or at the very least has a much wider view than almost any of its competitors. To that end, investors should take some encouragement from what looks like better operating conditions around the globe. That said, investors should not ignore HSBC's lower forward ROE guidance - a strong hint that the banking industry of tomorrow will not resemble the intra-bubble levels of profitability any time soon. (For background reading, see Analyzing A Bank's Financial Statements.)
Continue to the full piece through this link:
http://stocks.investopedia.
An OK End to the Year
For the full year of 2010, HSBC reported that revenue increased just over 3% to $68.2 billion, missing the consensus estimate by about $1 billion. Net interest income fell a bit more than 3%, largely due to lower rates. The company's overall net interest margin fell as well. The biggest delta on the revenue lines, though, was in trading results: HSBC booked about 25% less revenue here than in the year-ago period and that meant $2.6 billion less in operating revenue.
Unfortunately, the company did not exactly make up for it as it went along. Compensation and administrative expenses both grew at rates that outstripped revenue growth and the company saw its efficiency ratio move to an uninspiring 55.2% - well above its 50% target level. (For related reading, see Measuring Company Efficiency.)
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http://stocks.investopedia.
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