Grupo Financiero Galicia (BASE:GGAL) - Share price, News & Analysis

Q: What is the Fair Price of GGAL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GGAL (ARS222.2) is trading above our estimate of [[fair value]] (ARS32.15)

GGAL fundamental analysis
Snowflake Score
Valuation	1/6
Future Growth	3/6
Past Performance	3/6
Financial Health	5/6
Dividends	4/6

GGAL Stock Overview

Grupo Financiero Galicia S.A., a financial service holding company, provides various financial products and services to individuals and companies in Argentina.

Rewards

Price-To-Earnings ratio (9.4x) is below the AR market (13.7x)

Earnings are forecast to grow 27.34% per year

Earnings have grown 36.3% per year over the past 5 years

Risk Analysis

Unstable dividend track record

Grupo Financiero Galicia Competitors

Banco Macro

BASE:BMA

AR$234.8b

Banco BBVA Argentina

BASE:BBAR

AR$155.6b

Banco Patagonia

BASE:BPAT

AR$67.4b

BPER Banca

BIT:BPE

€2.2b

Price History & Performance

Summary of all time highs, changes and price drops for Grupo Financiero Galicia
Historical stock prices
Current Share Price	AR$222.20
52 Week High	AR$263.90
52 Week Low	AR$143.95
Beta	2.58
1 Month Change	11.43%
3 Month Change	25.40%
1 Year Change	52.82%
3 Year Change	27.30%
5 Year Change	228.94%
Change since IPO	12,818.61%

Shareholder Returns

	GGAL	AR Banks	AR Market
7D	-1.6%	-1.7%	-1.2%
1Y	52.8%	45.9%	78.8%

Return vs Industry: GGAL exceeded the AR Banks industry which returned 45.9% over the past year.

Return vs Market: GGAL underperformed the AR Market which returned 78.8% over the past year.

Price Volatility

Is GGAL's price volatile compared to industry and market?
GGAL volatility
GGAL Average Weekly Movement	5.8%
Banks Industry Average Movement	7.2%
Market Average Movement	6.3%
10% most volatile stocks in AR Market	8.4%
10% least volatile stocks in AR Market	5.0%

Stable Share Price: GGAL is not significantly more volatile than the rest of AR stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: GGAL's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1905	n/a	Fabian Enrique Kon	https://www.gfgsa.com

Grupo Financiero Galicia S.A., a financial service holding company, provides various financial products and services to individuals and companies in Argentina. The company operates through Banks, NaranjaX, Insurance, and Other Businesses segments. The company’s products and services cover savings, current, and checking accounts; personal loans; express and mortgage loans; pledge and credit card loans; credit and debit cards; and online banking services.

Grupo Financiero Galicia Fundamentals Summary

How do Grupo Financiero Galicia's earnings and revenue compare to its market cap?
GGAL fundamental statistics
Market Cap	AR$327.68b
Earnings (TTM)	AR$34.80b
Revenue (TTM)	AR$303.79b

9.4x

P/E Ratio

0.9x

P/B Ratio

Is GGAL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GGAL income statement (TTM)
Revenue	AR$303.79b
Cost of Revenue	AR$8.22b
Gross Profit	AR$295.57b
Other Expenses	AR$260.77b
Earnings	AR$34.80b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	23.60
Gross Margin	97.29%
Net Profit Margin	11.45%
Debt/Equity Ratio	63.1%

How did GGAL perform over the long term?

See historical performance and comparison

Dividends

3.4%

Current Dividend Yield

32%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is GGAL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

1/6

Valuation Score 1/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GGAL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GGAL. This is calculated by dividing GGAL's market cap by their current preferred multiple.
What is GGAL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AR$327.68b

GGAL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	n/a
Enterprise Value/EBITDA	n/a
PEG Ratio	0.3x

Price to Earnings Ratio vs Peers

How does GGAL's PE Ratio compare to its peers?

GGAL PE Ratio vs Peers

The above table shows the PE ratio for GGAL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	6.7x
BMA Banco Macro	8x	6.1%	AR$234.8b
BBAR Banco BBVA Argentina	7.5x	7.8%	AR$155.6b
BPAT Banco Patagonia	9.8x	n/a	AR$67.4b
BPE BPER Banca	1.6x	-24.7%	€2.2b
GGAL Grupo Financiero Galicia	9.4x	27.3%	AR$327.7b

Price-To-Earnings vs Peers: GGAL is expensive based on its Price-To-Earnings Ratio (9.4x) compared to the peer average (6.7x).

Price to Earnings Ratio vs Industry

How does GGAL's PE Ratio compare vs other companies in the South American Banks Industry?

Price-To-Earnings vs Industry: GGAL is expensive based on its Price-To-Earnings Ratio (9.4x) compared to the South American Banks industry average (7.7x)

Price to Earnings Ratio vs Fair Ratio

What is GGAL's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GGAL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	9.4x
Fair PE Ratio	13.4x

Price-To-Earnings vs Fair Ratio: GGAL is good value based on its Price-To-Earnings Ratio (9.4x) compared to the estimated Fair Price-To-Earnings Ratio (13.4x).

Share Price vs Fair Value

What is the Fair Price of GGAL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GGAL (ARS222.2) is trading above our estimate of fair value (ARS32.15)

Significantly Below Fair Value: GGAL is trading above our estimate of fair value.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

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Future Growth

How is Grupo Financiero Galicia forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

27.3%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: GGAL's forecast earnings growth (27.3% per year) is above the savings rate (7.7%).

Earnings vs Market: GGAL's earnings (27.3% per year) are forecast to grow faster than the AR market (21% per year).

High Growth Earnings: GGAL's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: GGAL's revenue (8.6% per year) is forecast to grow slower than the AR market (19.2% per year).

High Growth Revenue: GGAL's revenue (8.6% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: GGAL's Return on Equity is forecast to be low in 3 years time (13.2%).

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Past Performance

How has Grupo Financiero Galicia performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

36.3%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GGAL has high quality earnings.

Growing Profit Margin: GGAL's current net profit margins (11.5%) are higher than last year (10%).

Past Earnings Growth Analysis

Earnings Trend: GGAL's earnings have grown significantly by 36.3% per year over the past 5 years.

Accelerating Growth: GGAL's earnings growth over the past year (17.7%) is below its 5-year average (36.3% per year).

Earnings vs Industry: GGAL earnings growth over the past year (17.7%) underperformed the Banks industry 34.3%.

Return on Equity

High ROE: GGAL's Return on Equity (9.8%) is considered low.

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Financial Health

How is Grupo Financiero Galicia's financial position? (This company is analysed differently as a bank or financial institution)

Financial Health Score

5/6

Financial Health Score 5/6

Asset Level
Allowance for Bad Loans
Low Risk Liabilities
Loan Level
Low Risk Deposits
Level of Bad Loans

Financial Position Analysis

Debt to Equity History and Analysis

Balance Sheet

Financial Institutions Analysis

Asset Level: GGAL's Assets to Equity ratio (5.1x) is low.

Allowance for Bad Loans: GGAL has a sufficient allowance for bad loans (153%).

Low Risk Liabilities: 76% of GGAL's liabilities are made up of primarily low risk sources of funding.

Loan Level: GGAL has an appropriate level of Loans to Assets ratio (42%).

Low Risk Deposits: GGAL's Loans to Deposits ratio (69%) is appropriate.

Level of Bad Loans: GGAL has a high level of bad loans (3.4%).

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Dividend

What is Grupo Financiero Galicia current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.36%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: GGAL's dividend (3.36%) is higher than the bottom 25% of dividend payers in the AR market (0.67%).

High Dividend: GGAL's dividend (3.36%) is low compared to the top 25% of dividend payers in the AR market (4.5%).

Stability and Growth of Payments

Stable Dividend: GGAL's dividend payments have been volatile in the past 10 years.

Growing Dividend: GGAL's dividend payments have increased over the past 10 years.

Current Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (31.6%), GGAL's dividend payments are well covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: GGAL's dividends in 3 years are forecast to be well covered by earnings (18.5% payout ratio).

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Management

How experienced are the management team and are they aligned to shareholders interests?

1.8yrs

Average management tenure

CEO

Fabian Enrique Kon

2.08yrs

Tenure

Mr. Fabian Enrique Kon has been General Manager and Chief Executive Officer at Grupo Financiero Galicia SA since July 2020. Mr. Kon has been Chief Executive Officer at Banco de Galicia y Buenos Aires SAU(f...

Leadership Team

Experienced Management: GGAL's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.

Board Members

Experienced Board: GGAL's board of directors are seasoned and experienced ( 11.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/07 00:00
End of Day Share Price	2022/08/05 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31