Macroaxis Stories

Breaking down Foreign Trade Bank real value

October 29, 2024  By Aina Ster
Macroaxis Story
Foreign Trade Bank carries $4.68 billion in debt, with a debt-to-equity ratio of 7.53. This suggests the bank might struggle to generate enough cash to cover its financial obligations. However, leveraging debt can be a smart strategy for funding growth with potentially high returns. The bank has a performance score of 3 out of 100, indicating room for improvement. With a Beta of 1.45, the stock is more volatile than the market, suggesting it might outperform in rising markets but could underperform when markets decline. Currently, the risk level is at 1.56%. To better understand its potential, check the maximum drawdown and analyze the relationship between expected shortfall and daily rate of change to assess future price trends.

Main Takeaways

Considering an investment in Foreign Trade Bank Stock, the company's current valuation of 3.28B coupled with a price-to-book ratio of 0.95X suggests that the stock might be undervalued relative to its net assets of 10.74B. With a robust profit margin of 0.714, the bank demonstrates strong profitability, making it an attractive option for investors seeking value in the regional banking sector.
Published over a month ago
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Reviewed by Ellen Johnson

Foreign Trade Bank's stock presents an intriguing opportunity for investors looking to tap into the financial services sector. With a market capitalization of $1.2 billion and a price-to-book ratio of 0.95x, the stock appears undervalued compared to its book value of $34.35 per share. Despite a high probability of bankruptcy at 60.93%, the bank's robust operating margin of 73.69% and a net income from continuing operations of $150.8 million suggest a resilient core business. The forward dividend yield of 6.13% offers an attractive income stream, while the enterprise value of $3.3 billion underscores its substantial market presence. However, potential investors should weigh these factors against the bank's debt-to-equity ratio of 7.53%, which indicates a significant level of leverage. While many millennials are steering clear of the financial services sector, it's worth taking a closer look at Foreign Trade Bank to understand its current market dynamics. Let's explore why this year might be promising for its shareholders. Is the company's current valuation reasonable? We'll delve into Foreign Trade Bank's valuation to provide you with a clearer perspective on whether investing in this stock could be a smart move.
We determine the current worth of Foreign Trade Bank using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Foreign Trade Bank based exclusively on its fundamental and basic technical indicators. By analyzing Foreign Trade's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Foreign Trade's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Foreign Trade. We calculate exposure to Foreign Trade's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Foreign Trade's related companies.

Foreign Trade Bank Investment Alerts

Foreign investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Foreign Trade Bank performance across your portfolios.Please check all investment alerts for Foreign

Foreign Trade Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare Foreign value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Foreign Trade competition to find correlations between indicators driving the intrinsic value of Foreign.

Foreign Trade Gross Profit

Foreign Trade Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Foreign Trade previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Foreign Trade Gross Profit growth over the last 10 years. Please check Foreign Trade's gross profit and other fundamental indicators for more details.

An Additional Perspective On Foreign Trade Bank

The entity reported the last year's revenue of 712.2 M. Total Income to common stockholders was 166.16 M with profit before taxes, overhead, and interest of 143.7 M.

Margins Breakdown

Foreign profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Foreign Trade itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Foreign Trade profit margins.
0.22
Operating Profit Margin
0.22
Net Profit Margin
0.26
Pretax Profit Margin
Pretax Profit Margin0.26
Operating Profit Margin0.22
Net Profit Margin0.22
Gross Profit Margin1.09
Foreign Trade Market Cap is fairly stable at the moment.
Further, Foreign Trade Price To Sales Ratio is fairly stable at the moment. The stock market is filled with individuals who know the price of everything, but the value of nothing, said Oscar Wilde, and this sentiment rings true for Foreign Trade Bank stock. With a price-to-book ratio of 0.95X, the stock appears undervalued, suggesting a potential opportunity for investors to capitalize on its intrinsic worth. Despite a modest operating margin of 0.74%, the bank's robust net asset base of $10.74 billion underscores its financial stability. Coupled with a forward dividend yield of 6.13%, this stock could be a hidden gem for those seeking value in the regional banking sector..

Foreign Trade has 69 percent chance to slide below $32 in 30 days

Foreign Trade Bank's stock is currently facing some challenges, with a maximum drawdown of 5.52, indicating a significant drop from its recent peaks. This decline might suggest further downward movement, as there's a 69% chance the stock could fall below $32 in the next month. Investors should tread carefully, keeping a close eye on market conditions and considering protective measures. Despite its relatively low volatility, with a skewness of -0.59 and kurtosis of 1.54, understanding these metrics can help investors make informed decisions. During bearish trends, increased volatility can affect the stock price, causing stress for investors.
This often leads to portfolio adjustments, as investors seek to mitigate risk by diversifying their holdings when prices decline.As we look toward 2024, Foreign Trade Bank's stock (BLX) presents a compelling yet cautious opportunity for investors. With analysts suggesting a possible upside price of 33.71, there's potential for growth, but it's crucial to weigh this against the downside risk at 30.6. The strong buy consensus indicates optimism among analysts, yet it's essential for investors to stay informed and monitor market dynamics closely. As the fiscal year ends in December, keep an eye on year-end financial results, which could provide more clarity on the company's trajectory. With the highest estimated target price reaching 35.66, BLX could offer attractive returns, but as always, balancing risk and reward is key in making informed investment decisions..

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Editorial Staff

Aina Ster is a Member of Macroaxis Editorial Board. Aina delivers weekly perspective on ongoing market and economic trends, analysis and tips from predictive analysis to forecasting across various financial instruments. View Profile
This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Aina Ster do not own shares of Foreign Trade Bank. Please refer to our Terms of Use for any information regarding our disclosure principles.

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