* Note: Prices are in Million (M) USD.
Description:
Popular, Inc., offers various retail, mortgage and commercial banking products and services in Puerto Rico and the United States. The company is headquartered in Hato Rey, Puerto Rico.
These criteria used Company's Cash, EBITDA and Debt balance to determines its fair value:
Cash : $6,741 M
Debt : $1,358 M
EBITDA : $941 M
Since Cash is greater than Total Debt, 5 points assigned.
This criteria used industry in which company operates:
Sector: Financial services
Industry: Banks - regional - us
Based on industry, 3 points assigned.
This criteria used Company's Price To Earning (P/E) Ratio to determines its fair value:
Forward PE Ratio: 10.35
Since Forward PE Ratio is less than 15, 5 points assigned.
This criteria used Company's ability to convert Sales into free cash flow to determine fair value:
Using last 20 overlapping fiscal years (max 20).Average Free Cash Flow: $651 M
Average Revenue: $2,809 M
Revenue Converted To Free Cash Flow (%): 23.2%
Since Free Cash Flow (FCF) to Revenue percentage is greater than 15, 3 points assigned.
This criteria used company's growth potential to calculate its fair value:
Latest Revenue (2024-12-31): $4,189 M
Revenue 4 Years Ago (2020-12-31): $2,492 M
Last 5 Years Average Revenue Growth: 14%
Since Revenue Growth is between 10 - 15, 3 points assigned.
This criteria used Company's ability to buy back its own share:
Latest Share Count (2024-12-31): $72 M
Share Count 5 Years Ago (2020-12-31): $86 M
Company is buying back its own shares, 3 points assigned.
This criteria used Company's dividend payout ratio to determine its fair value:
Next Year Earnings Per Share (EPS): $12.74
Trailing 12-Month Earnings Per Share (EPS): $11.37
Average Earnings Per Share (EPS): $12.06
Dividend Per Share (DPS): $3
Payout Ratio: 23%
Dividend Yield: 2%
Since company Payout Ratio is less than 50, 2 points assigned.
Since Dividend Yield is greater than 2, 2 points assigned.
This criteria used Company's Return On Equity (ROE%) to determine its fair value:
Using last 20 valid ROE years (max 20).Average ROE: 5.0%
Since Average ROE is less than 10, 1 point assigned.
This criteria used Company's current price to its 52 week low price to determines its fair value:
Current Price: $125
52-Week Low: $78
Threshold Price (15% Above 52-Week Low): $89
Since Current price is not within 15% threshold, 0 point assigned.
This criteria used Company's Market Cap to determines its fair value:
Market Capitalization: $7,989 M
Since Market Cap is less than 10B, 1 point assigned.
% Exposure to Total Portfolio
Based on the market cap, we recommend do not exceed 2% exposure of Total Portfolio.
Value-Trade has assigned 28 points to above Popular Inc (BPOP) stock.
Heads up: One or more P/E inputs look exaggerated and may skew the blend.
• RCFC Based PE
28.53 (>2× median)
Further research is recommended; please use your own due diligence.In such cases, multiplying earnings by the long-run average P/E typically gives a closer, more reliable fair value.
Rule of thumb: Last 12 Years Avg P/E (9.77)
× EPS ($12.06) = $117.78.
Last 12 Years Avg PE 9.77, Fair Value PE 15, Industry Based PE 13, Growth Based PE 13, RCFC Based PE 28.53, ROE Based PE 14.04, Risk-Free Anchored PE (25% MoS) 17.08. Based on these 7 values, average assigned is 15.77. Value-Trades has assined P/E value 15.77. Since an average (Current Year EPS + Next Year EPS) earning per share is $12.055.
The fair value of Popular Inc (BPOP) stock should be (15.77 x $12.055) = $190.17.
