While we wait for the Federal Reserve to rule a further reduction of interest rates and the prompt approval of the tax incentive package by the US Congress, and following the concern of one of our readers about the future of
As I have said before, I understand that Argentina will not suffer the impact of the international crisis, and I have reasons to say that: a floating exchange rate gives flexibility to the economy, international reserves of US$ 47 billion, tax and trade surpluses, international prices for agricultural commodities are said to keep its current status, a heavy domestic demand and, on top of this, no direct exposure to the high-risk assets that generated the crisis.
However, our reader has reasons to worry about certain topics that
The inflation menace, for starters, that is everywhere even though the government does everything to hide it. Otherwise, how can we explain a 33% y-o-y increase in the collection of I.V.A. (value added tax)? Simple: 8.5 % belongs to the economic growth, 2% could be related to a higher efficiency in terms of collections…and what about the rest? This is clearly explained by inflation. Our pockets are not confused…
The energy problem is an issue that must be addressed as soon as possible because the country has reached its limit. Also,
It is true that
Another issue that makes
But despite its own concerns, our reader keeps the confidence on our country and asked me if I could recommend any given company to invest in. Yes, of course I can do that, and that is Banco Macro (NYSE:BMA ; MERV:BMA).
Banco Macro, chaired by Jorge Brito, is one of the main winners of the banking sector after the 2001 crisis. Following the crisis, the bank started a strong expansion process through acquisitions of other entities that ended up in the bank climbing to the sixth spot in the ranking of financial institutions, both in terms of assets as in deposits and loans. In terms of equity, Banco Macro is the second bank in the country. When many banks decided to hibernate, Banco Macro took the lead and its now enjoying the results of such decision.
I have X-rayed Banco Macro to find out that it shows a P/E of 11.34 (industry P/E is 16.67), a ROA of 2.84% (1.16% for the industry) and a ROE of 20.12% (12.97% for the industry). The bank’s doubtful accounts represent 1.36% of its total portfolio (2.66% is the doubtful portfolio of the entire banking system). Total headcount is 3,422 employees, where 246 branches are spread all over the country.
Not only have these indicators shown that this stock is an opportunity, but also that the context is benevolent to the bank: the argentine financial system is in full expansion, thus guaranteeing growth opportunities to this entity. At the moment,
The lovers of technical analysis that had already seen the graphics must be surely confused by my pick of a stock with a negative trend in its quote for the past six months. My answer is that this stock has been unfairly punished by a market that is afraid of banking stocks, and so the strong fall in its price has nothing to do with objective information. Moreover, on top of the financial indicators and market perspectives that endorse my opinion, Banco Macro has repurchased its own stocks a couple of weeks ago because it considered that they were not fairly priced by the market.
And last, I want to tell you that I have digged in my own backyard during the weekend to see if I was lucky to find oil or gas…only rocks already, but I still do not give up hope. Yesterday, Pan American Energy announced the discovery of an oil reservoir of around 100 million barrels in the