Credicorp (BAP) AI Stock Analysis

• Market Cap: $20.68B
• Dividend Yield: 5.36%
• Average Volume (3M): 368.16K
• Price to Earnings (P/E): 12.3
• Beta (1Y): 0.52
• Revenue Growth: 5.16%
• EPS Growth: 27.77%
• Country: US
• Employees: 38,758
• Sector: Financial
• Sector Strength: 77
• Industry: Banks - Regional
• EPS (TTM): 6.45
• Shares Outstanding: 79,533,100
• 10 Day Avg. Volume: 390,435
• 30 Day Avg. Volume: 368,159
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.87
• Enterprise Value/Revenue: 0.66
• Enterprise Value/Gross Profit: 1.00
• Enterprise Value/Ebitda: 2.00
• 1Y Price Target: $245.20
• Price Target Upside: -6.13% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

• Rating: 72 Outperform
• Price Target: $281.00 ▲(7.58% Upside)

Credicorp's overall stock score is driven by strong financial performance and attractive valuation, supported by a solid dividend yield. Despite bullish technical indicators, overbought conditions suggest caution. The earnings call highlights robust performance but also notes challenges such as a tax dispute and high efficiency ratios. The company remains fundamentally strong with opportunities for growth through digital transformation.

Positive Factors

Business Synergies

Credicorp is benefitting from higher synergies and profitability across business units.

Earnings

Credicorp reported strong earnings with net interest income increasing.

Profitability

Credicorp has reached record levels of profitability.

Negative Factors

Political and Economic Environment

Headwinds exist from the political cycle and international uncertainty affecting Peru.

Stock Valuation

The stock is at its historical peak, leading to a downgrade to Hold.

Sustainability of Profitability

There are doubts about Credicorp's ability to sustain record ROAE levels on a higher capital base.

Credicorp Business Overview & Revenue Model

Company Description

Credicorp Ltd., a financial service holding company, provides various financial, insurance, and health services and products primarily in Peru and internationally. The company's Universal Banking segment offers deposits and current accounts, and various credits and financial instruments to individuals and legal entities. Its Insurance and Pensions segment issues insurance policies to cover losses in commercial property, transportation, marine vessels, automobile, life, health, and pensions, as well as provides private pension fund management services. The company's Microfinance segment manages loans, credits, deposits, and current accounts of the small and microenterprises. Its Investment Banking and Wealth Management segment offers its services to corporations, institutional investors, governments, and foundations; engages in structuring and placement of issues in the primary market, as well as the execution and negotiation of operations in the secondary market; and structures securitization processes for corporate customers and manages mutual funds. The company was founded in 1889 and is headquartered in Lima, Peru.

How the Company Makes Money

Credicorp generates revenue through several key streams, primarily from interest income on loans and advances provided through its banking operations. The company's main revenue source comes from the interest rate spread between loans and deposits. Additionally, Credicorp earns fees and commissions from various services, including transaction fees, asset management fees, and insurance premiums. The company also benefits from investment income generated from its portfolio of securities. Significant partnerships with local and international financial institutions enhance its service offerings and expand its customer base, contributing to its overall earnings. Furthermore, the growth of digital banking services has opened new avenues for revenue through technology-driven financial products.

Credicorp Financial Statement Overview

Summary

Credicorp exhibits strong profitability and effective equity utilization but faces challenges in revenue growth and cash conversion. The balance sheet remains stable with manageable leverage, but cash flow fluctuations suggest a need for improved cash management strategies. Overall, the company is financially sound but should focus on enhancing revenue and operational cash flow stability to maintain long-term growth.

Income Statement

Credicorp shows strong profitability with a robust EBIT margin of 50.34% and a net profit margin of 30.24% for 2024. However, revenue has declined by 6.83% compared to 2023, indicating potential concerns in revenue generation. Historical data shows fluctuating revenue trends, peaking in 2023, but generally growing over the longer term since 2020.

Balance Sheet

The company maintains a healthy balance sheet with a debt-to-equity ratio of 0.66 and an equity ratio of 13.41%, reflecting moderate leverage and stable equity levels. Return on equity is strong at 16.02% for 2024, demonstrating effective utilization of equity. The balance sheet indicates resilience against potential financial instability, although equity levels show limited growth.

Cash Flow

Cash flow analysis reveals a decrease in free cash flow from the previous year, with a negative growth rate of 68.39%. The operating cash flow to net income ratio is 0.22, which highlights potential challenges in converting earnings to cash. Despite a positive free cash flow to net income ratio of 0.17, the cash flow from operations shows variability, suggesting potential liquidity management issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	27.23B	27.00B	25.37B	20.63B	19.22B	18.22B
Gross Profit	17.97B	17.33B	15.72B	14.76B	15.36B	9.07B
EBITDA	9.02B	8.55B	7.52B	7.51B	6.02B	901.09M
Net Income	5.77B	5.50B	4.87B	4.65B	3.58B	346.89M
Balance Sheet
Total Assets	254.22B	256.09B	238.84B	235.41B	243.44B	237.41B
Cash, Cash Equivalents and Short-Term Investments	86.24B	81.72B	67.34B	64.20B	74.42B	80.11B
Total Debt	35.45B	37.49B	37.55B	39.49B	47.71B	50.97B
Total Liabilities	217.81B	221.11B	205.73B	205.82B	216.61B	211.96B
Stockholders Equity	35.84B	34.35B	32.46B	29.00B	26.29B	24.95B
Cash Flow
Free Cash Flow	-3.69B	13.41B	2.93B	-2.05B	3.33B	12.05B
Operating Cash Flow	-3.53B	14.52B	4.08B	-1.15B	3.97B	12.69B
Investing Cash Flow	993.56M	527.56M	-1.26B	-1.09B	-3.73B	-1.87B
Financing Cash Flow	3.61B	-1.81B	-2.26B	-1.60B	-465.30M	-2.09B

Credicorp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 261.20
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BAP, the sentiment is Positive. The current price of 261.2 is above the 20-day moving average (MA) of 253.73, above the 50-day MA of 239.61, and above the 200-day MA of 198.19, indicating a bullish trend. The MACD of 6.03 indicates Negative momentum. The RSI at 71.32 is Negative, neither overbought nor oversold. The STOCH value of 80.73 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BAP.

Credicorp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CIB	81 Outperform	$13.20B	14.11	16.25%	12.56%	-8.82%	4.87%
BSAC	76 Outperform	$11.88B	10.38	24.13%	5.31%	12.43%	56.30%
BCH	73 Outperform	$15.05B	11.58	22.07%	6.92%	-13.16%	-8.10%
BAP	72 Outperform	$20.68B	12.34	18.54%	5.36%	5.16%	27.77%
BSBR	70 Outperform	$19.41B	18.88	9.43%	5.65%	-3.77%	-10.59%
Sector *	68 Neutral	$18.06B	11.97	10.24%	3.74%	9.75%	1.30%
BMA	56 Neutral	$3.76B	9.08	10.91%	1.31%	-57.78%	-67.92%