AU Small Finance Bank (NSE:AUBANK) GF Value Rank : 2 (As of May. 27, 2024)

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What is AU Small Finance Bank GF Value Rank?

AU Small Finance Bank has the GF Value Rank of 2.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

Competitive Comparison of AU Small Finance Bank's GF Value Rank

For the Banks - Regional subindustry, AU Small Finance Bank's GF Value Rank, along with its competitors' market caps and GF Value Rank data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

AU Small Finance Bank's GF Value Rank Distribution in the Banks Industry

For the Banks industry and Financial Services sector, AU Small Finance Bank's GF Value Rank distribution charts can be found below:

* The bar in red indicates where AU Small Finance Bank's GF Value Rank falls into.

AU Small Finance Bank GF Value Rank Related Terms

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AU Small Finance Bank (NSE:AUBANK) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » AU Small Finance Bank Ltd (NSE:AUBANK) » Definitions » GF Value Rank

Traded in Other Exchanges

540611:India

Address

Mile 0, Ajmer Road, Bank House, Jaipur, RJ, IND, 302001

Website

https://www.aubank.in

AU Small Finance Bank Ltd is engaged in the activities of providing financial services such as personal banking, insurance, retail loans and wholesale banking. The company operates in the business segment namely, Treasury; Retail banking; Wholesale banking; and Other banking operations. It generates maximum revenue from Retail banking segment. The retail banking segment serves retail customers through a branch network and other delivery channels. Revenues of the retail banking segment are derived from interest earned on retail loans, fees from services rendered, and others. Geographically, it operates only in India.

AU Small Finance Bank (NSE:AUBANK) Headlines

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