Grupo Aval Acciones y Valores SA Pfd (AVAL) AI Stock Analysis

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Grupo Aval Acciones y Valores SA Pfd

(NYSE:AVAL)

Rating:63Neutral

Price Target:―

Grupo Aval's overall score of 62.5 reflects a mixed outlook. Financial performance is hindered by revenue and cash flow challenges, with high leverage posing risks. Technical analysis indicates neutral momentum, and valuation is moderate. Positively, the earnings call showed strong income growth and strategic focuses, though offset by equity return challenges and regulatory issues.

Grupo Aval Acciones y Valores SA Pfd (AVAL) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$3.85B

Dividend Yield3.64%

Average Volume (3M)88.47K

Price to Earnings (P/E)9.9

Beta (1Y)0.44

Revenue Growth-6.63%

EPS Growth241.66%

CountryUS

Employees77,043

SectorFinancial

Sector Strength78

IndustryBanks - Regional

Share Statistics

EPS (TTM)0.10

Shares Outstanding376,840,700

10 Day Avg. Volume45,797

30 Day Avg. Volume88,474

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market Cap5.51

Enterprise Value/Revenue<0.01

Enterprise Value/Gross Profit<0.01

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusN/A

Number of Analyst Covering0

Grupo Aval Acciones y Valores SA Pfd Business Overview & Revenue Model

Company DescriptionGrupo Aval Acciones y Valores SA Pfd (AVAL) is a prominent financial conglomerate in Latin America, headquartered in Colombia. The company operates through a diversified portfolio of financial services, including commercial banking, investment banking, asset management, and insurance. Grupo Aval serves a wide range of clients, from individuals to large corporations, across various sectors by offering a comprehensive suite of financial products and services.

How the Company Makes MoneyGrupo Aval generates revenue primarily through its banking operations, which include interest income from loans and advances to customers, as well as fees and commissions from various financial services. The company also earns money through its investment banking activities, which involve underwriting, advisory services, and securities trading. Additionally, Grupo Aval benefits from its asset management and insurance segments, which provide fee-based income and risk management solutions. The conglomerate's strategic partnerships and its extensive presence in the Latin American financial market further bolster its earnings by expanding its customer base and enhancing its service offerings.

Grupo Aval Acciones y Valores SA Pfd Earnings Call Summary

Earnings Call Date:Aug 14, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 12, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance with record net income and improved net interest margins. There were significant advancements in ESG initiatives and a positive economic outlook for Colombia. However, challenges such as soft loan growth, fiscal sustainability issues, and intense price competition were noted.

Q2-2025 Updates

Positive Updates

Record Net Income

Grupo Aval's net income for Q2 2025 was COP 494.9 billion, the highest quarterly figure in 3 years, representing a 37% increase over the quarter and a 142% increase year-over-year.

Improved Net Interest Margin

The net interest margin reached 4%, with the consolidated NIM on loans hitting 4.5%, the highest in 3 years.

Substantial Loan and Deposit Growth

Gross loans grew 3.2% year-over-year, and deposits grew 6.8% during the same period.

ESG Achievements

Significant progress in ESG initiatives, including a double materiality assessment involving 280 stakeholders, and the launch of the Aval Board of Directors guideline.

Positive Economic Outlook

The Colombian economy is expected to grow by 2.7% in 2025, with inflation anticipated to close at around 4.9%.

Negative Updates

Soft Loan Growth Dynamics

Loan growth dynamics have been softer than anticipated, although activity picked up in June and July.

Fiscal Challenges

Colombia's fiscal deficit is estimated to be closer to 8% of GDP, significantly above the original target.

High Central Bank Rates

The Central Bank opted to keep rates unchanged at 9.25%, maintaining a cautious stance due to external and internal risks.

Intense Price Competition

Aggressive price competition in the market affected commercial loan growth, and changes in regulation forced lower interest rate caps for consumer loans.

Company Guidance

During the second quarter of 2025, Grupo Aval reported a significant increase in net income, which reached COP 494.9 billion, marking a 37% growth over the quarter and a 142% year-over-year increase. The net interest margin (NIM) on loans improved to 4.5%, driven by a strategic focus on enhancing the deposit mix toward retail funding, with peso-denominated deposits by individuals increasing to 18.2%. The cost of risk decreased to 1.7%, and gross loans grew by 3.2% year-over-year, while deposits rose by 6.8%. Grupo Aval's strategic initiatives included the implementation of a procurement synergy center aiming for more than 10% savings on a COP 2.1 trillion manageable spending base. Looking forward, the company anticipates a return on average equity of around 10.5% for 2025, with expected loan growth of approximately 7% and a consolidated NIM in the 4% range.

Grupo Aval Acciones y Valores SA Pfd Financial Statement Overview

Summary

Grupo Aval's financial performance shows challenges with declining revenue growth and cash flow sustainability, alongside high leverage and reduced return on equity, despite strong profitability margins.

Income Statement

Neutral

The income statement reflects moderate profitability with a gross profit margin consistently at 100%, indicating that all revenue is gross profit, likely due to the nature of financial services. However, net profit margin has shown volatility, decreasing from 24.6% in 2020 to 8.6% in 2023, and slightly improving to 8.7% in 2024. Revenue growth has been negative in recent years, with a significant decline from 2020 to 2023, but it stabilized between 2023 and 2024. EBIT margin remains strong, but fluctuated, showing some operational challenges.

Balance Sheet

Neutral

The balance sheet indicates high leverage, with a debt-to-equity ratio of approximately 2.47 in 2024, reflecting significant reliance on debt financing. The equity ratio has been relatively stable, showing a slight decrease to 5.3% in 2024, highlighting potential financial risk. Return on equity declined sharply from 22.4% in 2020 to 5.8% in 2024, indicating reduced efficiency in generating profits from shareholders' equity.

Cash Flow

Neutral

Cash flow analysis shows a concerning trend with negative free cash flow in 2024 at -14.7 trillion, compared to positive cash flow in past years. The operating cash flow to net income ratio is negative, suggesting operational cash flow challenges. The free cash flow to net income ratio is also negative, indicating potential sustainability issues in covering net income through free cash flow.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	11.74T	11.71T	16.28T	16.01T	15.41T
Gross Profit	11.74T	11.71T	13.57T	15.99T	15.41T
EBITDA	4.41T	0.00	0.00	0.00	0.00
Net Income	1.02T	739.00B	2.48T	3.30T	2.35T
Balance Sheet
Total Assets	10.00T>	10.00T>	10.00T>	10.00T>	10.00T>
Cash, Cash Equivalents and Short-Term Investments	7.28T	8.41T	40.97T	35.62T	64.51T
Total Debt	43.13T	65.54T	72.12T	73.28T	58.62T
Total Liabilities	10.00T>	10.00T>	10.00T>	10.00T>	10.00T>
Stockholders Equity	17.45T	16.78T	16.47T	23.01T	20.66T
Cash Flow
Free Cash Flow	-14.70T	511.93B	-1.37T	3.65T	7.99T
Operating Cash Flow	-14.04T	1.81T	-222.12B	5.90T	10.02T
Investing Cash Flow	-3.14T	1.84T	-13.01T	-6.60T	-7.59T
Financing Cash Flow	13.46T	-3.54T	-8.57T	-1.35T	404.45B

Grupo Aval Acciones y Valores SA Pfd Technical Analysis

Technical Analysis Sentiment

Positive

Last Price3.33

Price Trends

50DMA

2.98

Positive

100DMA

2.85

Positive

200DMA

2.63

Positive

Market Momentum

MACD

0.12

Negative

RSI

67.54

Neutral

STOCH

68.43

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVAL, the sentiment is Positive. The current price of 3.33 is above the 20-day moving average (MA) of 3.15, above the 50-day MA of 2.98, and above the 200-day MA of 2.63, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 67.54 is Neutral, neither overbought nor oversold. The STOCH value of 68.43 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AVAL.

Grupo Aval Acciones y Valores SA Pfd Risk Analysis

Grupo Aval Acciones y Valores SA Pfd disclosed 74 risk factors in its most recent earnings report. Grupo Aval Acciones y Valores SA Pfd 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

Grupo Aval Acciones y Valores SA Pfd Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OZK	80 Outperform	$5.95B	8.51	12.68%	3.24%	7.12%	2.47%
BBAR	69 Neutral	$2.54B	8.04	13.26%	0.19%	-47.41%	-18.95%
SUPV	69 Neutral	$722.01M	10.71	8.59%	2.39%	-55.30%	-64.02%
Sector *	68 Neutral	$17.90B	11.86	10.29%	3.72%	9.74%	1.66%
BANF	68 Neutral	$4.43B	19.19	14.43%	1.38%	9.63%	15.57%
AVAL	63 Neutral	$3.85B	9.85	9.57%	3.64%	-6.63%	241.66%
BMA	56 Neutral	$3.76B	845.69	10.91%	1.32%	-57.78%	-67.92%

* Financial Sector Average

Performance Comparison

AVAL

Grupo Aval Acciones y Valores SA Pfd

3.33

1.36

69.04%

BANF

BancFirst

132.97

30.31

29.52%

BMA

Banco Macro SA

57.93

-2.00

-3.34%

OZK

Bank OZK

52.47

11.52

28.13%

BBAR

Banco BBVA Argentina

12.25

1.83

17.56%

SUPV

Grupo Supervielle SA

7.84

0.56

7.69%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Mar 21, 2025