Banco Bilbao (BBVA) AI Stock Analysis

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Banco Bilbao

(NYSE:BBVA)

78Outperform

BBVA scores well due to strong financial performance and positive earnings call insights, which highlight robust profitability and strategic growth focus. Valuation metrics further support the stock's attractiveness, though high leverage and cash flow volatility present risks.

Positive Factors

Earnings

Net profit is 8% ahead of consensus.

Growth Potential

BBVA is one of the '25 stocks for 2025' and is added to the Europe 1 list of top ideas, showcasing its potential for growth.

Strategic Initiatives

M&A with Sabadell could unlock significant value through market share gains, cost synergies, and scale in product offerings.

Negative Factors

Expenses

Costs were a 10% higher vs. consensus.

Market Valuation

BBVA trades at a steep discount to peers despite a c.19% ROTE.

Banco Bilbao (BBVA) vs. S&P 500 (SPY)

Market Cap

$69.55B

Dividend Yield4.71%

Average Volume (3M)3.43M

Price to Earnings (P/E)7.0

Beta (1Y)0.83

Revenue Growth30.24%

EPS Growth28.90%

CountryUS

Employees125,916

SectorFinancial

Sector Strength79

IndustryBanks - Diversified

Share Statistics

EPS (TTM)1.87

Shares Outstanding5,763,285,600

10 Day Avg. Volume2,847,292

30 Day Avg. Volume3,427,862

Financial Highlights & Ratios

PEG Ratio0.24

Price to Book (P/B)N/A

Price to Sales (P/S)1.81

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$13.68

Price Target Upside9.09% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Banco Bilbao Business Overview & Revenue Model

Company DescriptionBanco Bilbao Vizcaya Argentaria, S.A., together with its subsidiaries, provides retail banking, wholesale banking, and asset management services. It offers current accounts; and demand, savings, overnight, time, term, and subordinated deposits. The company also provides loan products; deals in securities; and manages pension and investment funds. In addition, it offers credit cards; corporate and investment banking services; insurance products and services; and real estate services. The company provides its products through online and mobile channels. As of December 31, 2021, it operated through a network of 6,083 branches and 29,148 ATMs. It operates in Spain, Mexico, South America, the United States, Turkey, Asia, and rest of Europe. Banco Bilbao Vizcaya Argentaria, S.A. was founded in 1857 and is headquartered in Bilbao, Spain.

How the Company Makes MoneyBBVA generates revenue primarily through interest income from loans and mortgages, as well as from fees and commissions associated with banking services like asset management, transaction processing, and advisory services. The bank also earns income from trading and investment activities, which includes buying and selling securities and other financial instruments. Key revenue streams include retail banking services, which provide interest and fee income, and corporate banking, which offers loans, credit, and financial services to businesses. BBVA's digital transformation strategy aims to enhance customer experience and drive growth in digital banking, contributing to its revenue. Strategic partnerships and collaborations, such as fintech alliances and joint ventures, also play a significant role in expanding its market reach and boosting earnings.

Banco Bilbao Financial Statement Overview

Summary

Overall, BBVA exhibits a strong financial position with notable revenue growth, profitability, and efficient cash flow management. The balance sheet remains stable with manageable leverage, although there are periods of variability in operational efficiency and cash flows. The company is well-positioned in the banking industry, though careful attention to debt levels and operational efficiency is advised to maintain its strong financial performance.

Income Statement

Very Positive

BBVA demonstrates strong revenue growth with a significant increase in Total Revenue over the years, especially evident in the TTM (Trailing-Twelve-Months) period. The Gross Profit Margin and Net Profit Margin are healthy, indicating efficient cost management and profitability. However, fluctuations in EBIT and EBITDA margins suggest some variability in operational efficiency.

Balance Sheet

Positive

The balance sheet reflects a solid equity base with a stable Debt-to-Equity Ratio, suggesting manageable leverage levels. Return on Equity (ROE) is robust, indicating effective use of equity to generate profits. The Equity Ratio is consistent, highlighting a stable asset structure. Potential risks include the significant Total Debt, which requires careful management.

Cash Flow

Positive

The cash flow statement shows strong Free Cash Flow growth in the latest period, contributing to financial flexibility. The Operating Cash Flow to Net Income Ratio is favorable, indicating efficient cash generation relative to profits. There are fluctuations in Free Cash Flow, suggesting potential variability in cash generation capabilities.

TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Breakdown
Income Statement		Total Revenue
45.48B	27.16B	11.00M	22.82B	23.11B	24.62B
	Gross Profit
45.48B	29.54B	11.00M	22.82B	23.11B	24.62B
	EBIT
12.31B	15.30B	9.95B	6.56B	2.69B	5.57B
	EBITDA
7.50B	0.00	11.57B	8.48B	0.00	8.47B
	Net Income Common Stockholders
9.68B	8.02B	6.36B	4.65B	3.84B	3.51B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
216.55B	256.84B	225.41B	228.87B	208.37B	178.59B
	Total Assets
631.94B	775.56B	712.09B	662.88B	733.80B	695.47B
	Total Debt
113.90B	179.11B	114.64B	116.09B	110.80B	115.91B
	Net Debt
82.68B	95.74B	29.55B	41.53B	37.90B	66.36B
	Total Liabilities
580.33B	720.29B	661.57B	614.13B	683.78B	640.54B
	Stockholders Equity
49.10B	51.70B	46.90B	43.91B	44.55B	48.73B
Cash Flow		Free Cash Flow
62.25B	-2.54B	21.28B	-2.19B	38.23B	-9.59B
	Operating Cash Flow
63.59B	-721.00M	23.72B	-1.24B	39.35B	-8.21B
	Investing Cash Flow
-65.33B	-1.42B	-3.91B	-1.63B	-37.00M	98.00M
	Financing Cash Flow
-2.90B	-1.84B	-7.56B	-4.35B	-2.07B	-2.70B

Banco Bilbao Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price12.54

Price Trends

50DMA

12.75

Negative

100DMA

11.26

Positive

200DMA

10.52

Positive

Market Momentum

MACD

0.27

Positive

RSI

50.68

Neutral

STOCH

16.49

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBVA, the sentiment is Neutral. The current price of 12.54 is below the 20-day moving average (MA) of 13.29, below the 50-day MA of 12.75, and above the 200-day MA of 10.52, indicating a neutral trend. The MACD of 0.27 indicates Positive momentum. The RSI at 50.68 is Neutral, neither overbought nor oversold. The STOCH value of 16.49 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for BBVA.

Banco Bilbao Risk Analysis

Banco Bilbao disclosed 23 risk factors in its most recent earnings report. Banco Bilbao reported the most risks in the “Finance & Corporate” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Banco Bilbao Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
HSBC	81 Outperform	$161.79B	7.91	13.74%	6.64%	6.79%	8.57%
BCS	81 Outperform	$44.30B	7.58	9.14%	3.05%	8.58%	35.39%
BBVA	78 Outperform	$69.55B	6.96	18.77%	4.71%	30.24%	28.90%
NWG	77 Outperform	$43.16B	8.44	13.34%	4.64%	18.85%	14.85%
SAN	76 Outperform	$89.03B	7.56	13.16%	2.38%	6.56%	19.02%
ING	75 Outperform	$53.02B	8.43	12.75%	5.63%	4.07%	9.97%
Sector *	64 Neutral	$13.46B	9.44	9.34%	4.72%	16.14%	-8.80%

* Financial Sector Average

Performance Comparison

BBVA

Banco Bilbao

12.54

2.56

25.65%

BCS

Barclays

13.56

4.65

52.19%

HSBC

HSBC Holdings

48.22

10.99

29.52%

ING

ING Groep

17.42

2.69

18.26%

NWG

NatWest Group

11.27

4.71

71.80%

SAN

Banco Santander SA

6.23

1.72

38.14%

Banco Bilbao Earnings Call Summary

Earnings Call Date: Jan 30, 2025 | % Change Since: 12.16% | Next Earnings Date: Apr 29, 2025

Earnings Call Sentiment Positive

The earnings call presented a strong performance by BBVA, with record profitability and significant growth in key areas such as net profit, loan portfolio, and sustainability initiatives. Despite challenges like currency depreciation and competitive pressures in Spain, the overall outlook remains positive with strategic focus on digital transformation and sustainable growth.

Highlights

Record-Breaking Profitability

BBVA achieved a return on tangible equity of 19.7% and a return on equity of 18.9%, marking the best figures over the past decade.

Strong Earnings and Growth

Net attributable profit surpassed €10 billion, growing 25% from the previous year, and earnings per share increased by 28% year-over-year.

Significant Loan Portfolio Expansion

The loan portfolio increased by 14.3%, and the bank acquired 11.4 million new customers.

Sustainability Milestones

Channeled €100 billion in sustainable business, surpassing the cumulative 2018-2025 goal of €300 billion one year early.

Shareholder Returns

Total distributions to shareholders amounted to €5 billion, with a cash dividend of €0.70 per share and a new share buyback program.

Lowlights

Currency Depreciation Challenge

Despite strong growth, the bank faced market headwinds with relatively high currency depreciation, particularly in the Mexican peso.

Spanish Market Competition

The competitive environment in Spain, especially in mortgages, may impact loan growth expectations due to aggressive pricing.

Potential Regulatory Impacts

Basel IV impacts might slightly affect capital in 2028 due to operational risk, although no negative impacts are expected in 2025-2027.

Company Guidance

During the call, BBVA highlighted its strong financial performance in 2024, achieving a return on tangible equity of 19.7% and surpassing €10 billion in net attributable profit for the first time. The bank also reported a 14.3% increase in its loan portfolio and added 11.4 million new customers. Shareholders benefited from a €5 billion distribution, including a €0.70 cash dividend per share and a share buyback program worth €993 million. Furthermore, BBVA maintained a CET1 ratio of 12.88%, comfortably above its target. Notably, the bank channeled nearly €100 billion into sustainable business, reinforcing its commitment to sustainability. Looking ahead, BBVA plans to continue its strategic focus on profitable growth and customer satisfaction, with anticipated loan growth in several key markets, while also leveraging AI and digital capabilities.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.