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Tiziano Frateschi
Tiziano Frateschi
Articles (2646)  | Author's Website |

5 Banks Trading With Low Price-Earnings Ratios

Citigroup makes the list

September 14, 2020 | About:

As of Sept. 14, the GuruFocus All-in-One Screener, a Premium feature, found that the following banks have low price-earnings ratios and are owned by gurus. While some of them are great value investments, others may need to be researched more carefully, according to the discounted cash flow calculator.

Citigroup

With a market cap of $107.01 billion, Citigroup Inc. (C) has a price-earnings ratio of 8.91 and a price-book ratio of 0.62. According to the DCF calculator, the stock has a fair value of $62.07 while trading at $51.40.

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The stock has lost 22.31% over the last 12 months and is now 38.15% below the 52-week high and 60.62% above the 52-week low.

The financial services company has a GuruFocus profitability rating of 4 out of 10. The return on equity of 6.46% and return on assets of 0.66% are underperforming 61% of companies in the banks industry. Its financial strength is rated 3 out of 10. The cash-debt ratio of 0.97 is above the industry median of 1.36.

ValueAct Holdings LP (Trades, Portfolio) is the company's largest guru shareholder with 1.30% of outstanding shares, followed by HOTCHKIS & WILEY with 0.56% and Diamond Hill Capital (Trades, Portfolio) with 0.45%.

Royal Bank of Canada

With a $105.87 billion market cap, Royal Bank of Canada (RY) is trading with a price-earnings ratio of 12.53 and a price-book ratio of 1.76. According to the DCF calculator, the stock has a fair value of $81.10 while trading at $74.03

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The share price has risen 0.39% over the past 12 months and is now 10.53% below the 52-week high and 49.40% above the 52-week low.

The bank has a GuruFocus profitability rating of 5 out of 10. While the return on assets of 0.74% is underperforming the sector, the return on equity of 13.22% is outperforming 84% of companies in the banks industry. Its financial strength is rated 5 out of 10. The cash-debt ratio of 16.15 is far above the industry median of 1.36.

With 0.12% of outstanding shares, Jeremy Grantham (Trades, Portfolio) is the company's largest guru shareholder, followed by Pioneer Investments (Trades, Portfolio) with 0.03%.

The Toronto-Dominion Bank

With a market cap of $88.11 Billion, The Toronto-Dominion Bank (TD) is trading with a price-earnings ratio of 12.34. According to the DCF calculator, the stock has a fair value of $64.09 while trading at $43.39.

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Shares have lost 8.87% over the last 12 months and are now 17.30% below the 52-week high and 43.42% above the 52-week low.

The bank has a GuruFocus profitability rank of 5 out of 10. The company's return on equity of 10.4% is outperforming 71% of competitors in the banks industry. Its financial strength is rated 4 out of 10 with a cash-debt ratio of 9.28 that is far above the industry median of 1.36.

Pioneer Investments (Trades, Portfolio) is the company's largest guru shareholder with 0.04% of outstanding shares, followed by Jim Simons (Trades, Portfolio)' Renaissance Technologies with 0.03%.

U.S. Bancorp

U.S. Bancorp (USB) has a market cap of $55.03 Billion and is trading with a price-earnings ratio of 11.49 and a price-book ratio of 1.20. According to the DCF calculator, the stock has a fair value of $52.40 while trading at $36.53.

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Shares have fallen 30.41% over the last 12 months and are now trading 40.22% below the 52-week high and 28.81% above the 52-week low.

The financial services provider has a GuruFocus profitability rating of 5 out of 10. The return on equity of 9.42% and return on assets of 1.03% are outperforming 65% of companies in the banks industry. Its financial strength is rated 3 out of 10 with a cash-debt ratio of 0.83 that is above the industry median of 1.38.

With 8.76% of outstanding shares, Warren Buffett (Trades, Portfolio)'s Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) is the company's largest guru shareholder, followed by Barrow, Hanley, Mewhinney & Strauss with 1.04% and Chris Davis (Trades, Portfolio) with 0.89%.

Bank of Nova Scotia

Bank of Nova Scotia (BNS) has a market cap of $51.28 billion. Its shares are trading with a price-earnings ratio of 9.88. According to the DCF calculator, the stock has a fair value of $58.08 while trading at $42.10.

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Shares have decreased 18.81% over the past 12 months and are currently trading 27.69% below the 52-week high and 31.81% above the 52-week low.

The global financial services provider has a GuruFocus profitability rating of 4 out of 10. The return on equity of 10.3% is outperforming 74% of competitors in the banks industry. Its financial strength is rated 4 out of 10. The cash-debt ratio of 8.05 is above the industry median of 1.36.

The company's largest guru shareholder is Renaissance Technologies with 0.31% of outstanding shares, followed by Pioneer Investments (Trades, Portfolio) with 0.05% and Prem Watsa (Trades, Portfolio) with 0.02%.

Disclosure: I do not own any stocks mentioned.

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About the author:

Tiziano Frateschi
You can read about me on www.theextraincome.info, which gives suggestions on position trading.

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