Grupo Financiero Galicia SA (GGAL) AI Stock Analysis

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Grupo Financiero Galicia SA

(NASDAQ:GGAL)

Rating:71Outperform

Price Target:―

Grupo Financiero Galicia SA displays strong financial performance with solid revenue growth and profitability. The stock's technical indicators show potential upward momentum, though the MACD suggests caution. The valuation indicates the stock is undervalued with a low P/E ratio and attractive dividend yield. Cash flow management is a concern that may affect financial flexibility, necessitating improvement in this area.

Positive Factors

Earnings Growth

Analyst expects earnings to bounce back to an average earnings growth of approximately 60% in 2026-2027.

Revenue Generation

Galicia reported net income better-than-expected on better revenue generation, greater cost control, and lower provision charges.

Stock Rating

There is attractive upside potential of 60% prompting a Buy rating.

Negative Factors

Operating Expenses

Earnings are expected to decline because of high operating expenses related to HSBC’s acquisition and higher provision charges on accelerated loan growth.

ROAE Decline

Reported ROAE of 8.9% represents a decline from previous levels.

Grupo Financiero Galicia SA (GGAL) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$6.18B

Dividend Yield1.45%

Average Volume (3M)1.54M

Price to Earnings (P/E)5.5

Beta (1Y)0.73

Revenue Growth-42.92%

EPS Growth-21.46%

CountryUS

Employees9,183

SectorFinancial

Sector Strength78

IndustryBanks - Regional

Share Statistics

EPS (TTM)1.18

Shares Outstanding132,503,200

10 Day Avg. Volume2,418,683

30 Day Avg. Volume1,537,864

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 Cap0.87

Enterprise Value/Revenue<0.01

Enterprise Value/Gross Profit<0.01

Enterprise Value/Ebitda<0.01

Forecast

1Y Price Target

$67.00

Price Target Upside70.57% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Grupo Financiero Galicia SA Business Overview & Revenue Model

Company DescriptionGrupo 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. It also offers financing products and services; consumer finance services; electronic check; global custody services; Fima funds; financial and stock market services to individuals, companies, and financial institutions; foreign trade services; and capital market and investment banking products that include debt securities, short-term securities, bills, and financial trusts. In addition, the company provides robbery, personal accident, life collective, home, life, integral pyme, pet, surety, various risks, and technical insurance products. Further, it offers private banking services to high net worth individuals; and operates digital investment platform. As of December 31, 2021, it had 312 full service banking branches; and 1,991 ATMs and self-service terminals. Grupo Financiero Galicia S.A. was founded in 1905 and is based in Buenos Aires, Argentina.

How the Company Makes MoneyGrupo Financiero Galicia SA generates revenue through multiple streams primarily anchored in its banking operations. The company's main source of income comes from interest income on loans and advances issued to individuals, businesses, and government entities. Additionally, GGAL earns substantial fee-based income from services such as asset management, financial advisory, and bancassurance products. The company also benefits from transactional banking fees, including those from credit card services, account maintenance, and electronic banking transactions. GGAL's strategic partnerships, particularly within the insurance and asset management sectors, further bolster its revenue by offering diversified financial products that cater to a broad customer base. The company's ability to leverage its extensive branch network and digital platforms plays a critical role in maintaining its market share and expanding its customer reach, thus enhancing its revenue generation capabilities.

Grupo Financiero Galicia SA Earnings Call Summary

Earnings Call Date:Aug 26, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Nov 25, 2025

Earnings Call Sentiment Neutral

The earnings call presented a mixed picture with substantial growth in loans and deposits, as well as a successful merger, but faced significant challenges with a sharp decline in net income, increased nonperforming loans, and margin compression due to interest rate volatility.

Q2-2025 Updates

Positive Updates

Economic Activity Growth

The Argentina economy recorded a 6.4% year-over-year increase during June, reaching an expansion of 6.2% during the first half of 2025.

Successful Merger with Galicia Más

Grupo Financiero Galicia successfully completed the merger with Galicia Más, formerly HSBC in Argentina, leading to a market share growth of around 2.5% in both loans and deposits.

Growth in Loans and Deposits

The bank's financing to the private sector increased 123% in the last 12 months, with peso financing rising 106% and dollar-denominated financing growing 181%. Deposits reached ARS 19.9 trillion, a 72% increase from the previous year.

Net Fee Income Increase

Net fee income increased by 30% from June 2024, driven by a 51% increase in income from credit card fees and a 28% rise in fees on deposits.

Negative Updates

Significant Net Income Decline

Net income amounted to ARS 173 billion, 70% lower than the previous year. This was due to a 67% lower operating result and a 36% decrease in net interest income.

Increase in Nonperforming Loans

The ratio of nonperforming loans to total financing ended the quarter at 4.4%, recording a 240 basis points deterioration compared to the previous year, particularly in personal loans and credit card financing.

Operating Income and Loan Loss Provisions

Net operating income decreased by 40%, with loan loss provisions increasing by 192% due to growth in the financing portfolio and increased delinquency.

Margin Compression and Interest Rate Volatility

Significant short-term interest rate increases led to margin compression expected in Q3, with funding repricing faster than assets. This is expected to stabilize after elections.

Company Guidance

During Grupo Financiero Galicia's second quarter 2025 earnings call, several key metrics were highlighted. Argentina's economy showed a robust 6.4% year-over-year growth in June, contributing to a 6.2% expansion in the first half of 2025. The country's primary surplus in the second quarter was 0.4% of GDP, with overall surplus at 0.2% of GDP due to primary revenues rising 37.7% year-over-year and primary spending increasing by 42.1%. Inflation was a focal point, with the National Consumer Price Index increasing 6% in the second quarter and 17.3% year-to-date by July. The exchange rate averaged ARS 1,181 per dollar in June, reflecting a 23.5% year-over-year devaluation. Grupo Galicia's net income for the quarter was ARS 173 billion, marking a 70% decrease from the previous year, with a 1.9% annualized return on average assets and a 9.5% return on average shareholders' equity. The bank's Tier 1 capital ratio stood at 23.2%, down from the previous year, while the loan portfolio saw significant growth, with peso-denominated loans increasing 19% quarterly and 181.7% annually. Additionally, the merger with Galicia Más boosted the bank's market share by 2.5% in both loans and deposits.

Grupo Financiero Galicia SA Financial Statement Overview

Summary

Grupo Financiero Galicia SA shows strong revenue growth and profitability supported by a solid balance sheet. However, challenges in cash flow management need attention to maintain financial flexibility.

Income Statement

Very Positive

Grupo Financiero Galicia SA has demonstrated robust revenue growth with significant increases in total revenue over the years. The gross profit margin remains consistently high, indicating strong core operations. The net profit margin also shows healthy profitability. However, the absence of EBITDA figures limits a comprehensive analysis of earnings before interest, taxes, depreciation, and amortization.

Balance Sheet

Positive

The company maintains a moderate debt-to-equity ratio, reflecting balanced leverage. The return on equity is strong, indicating efficient use of shareholder capital. The equity ratio is stable, showing a solid financial foundation. However, the significant increase in total liabilities suggests potential risks that require monitoring.

Cash Flow

Positive

Despite a negative free cash flow in the latest period, the company has shown growth in operating cash flow over previous years. The free cash flow to net income ratio is negative, indicating challenges in converting profits into cash, signaling a need for improved cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.86T	10.63T	3.35T	2.15T	1.76T	597.96B
Gross Profit	6.24T	6.66T	3.35T	2.15T	1.76T	597.96B
EBITDA	1.77T	2.40T	36.33M	0.00	0.00	0.00
Net Income	1.38T	1.62T	337.17B	151.26B	188.62B	74.01B
Balance Sheet
Total Assets	28.85T	32.52T	10.22T	10.49T	3.27T	1.59T
Cash, Cash Equivalents and Short-Term Investments	5.58T	3.76T	2.00T	627.91B	462.49B	307.79B
Total Debt	1.36T	2.16T	465.73B	491.26B	160.31B	85.89B
Total Liabilities	23.36T	26.45T	8.20T	8.59T	2.68T	1.32T
Stockholders Equity	5.49T	6.06T	2.02T	1.90T	593.09B	275.22B
Cash Flow
Free Cash Flow	-3.43T	-2.92T	1.59T	1.74T	1.66T	519.33B
Operating Cash Flow	-3.10T	-2.70T	1.67T	1.79T	1.72T	540.28B
Investing Cash Flow	-2.98T	862.19B	-81.86B	-58.23B	-51.06B	-19.94B
Financing Cash Flow	8.13T	413.52B	-229.76B	83.96B	51.13B	-103.22B

Grupo Financiero Galicia SA Technical Analysis

Technical Analysis Sentiment

Negative

Last Price39.28

Price Trends

50DMA

48.30

Negative

100DMA

53.23

Negative

200DMA

56.59

Negative

Market Momentum

MACD

-2.86

Positive

RSI

25.47

Positive

STOCH

11.96

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GGAL, the sentiment is Negative. The current price of 39.28 is below the 20-day moving average (MA) of 46.62, below the 50-day MA of 48.30, and below the 200-day MA of 56.59, indicating a bearish trend. The MACD of -2.86 indicates Positive momentum. The RSI at 25.47 is Positive, neither overbought nor oversold. The STOCH value of 11.96 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GGAL.

Grupo Financiero Galicia SA Risk Analysis

Grupo Financiero Galicia SA disclosed 44 risk factors in its most recent earnings report. Grupo Financiero Galicia SA 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 3 New Risks

The management of Banco Galicia's business (the main subsidiary of Grupo Galicia) could be affected by its shareholder composition. Q4, 2022

Possible negative effects on the results of Banco Galicia (the main subsidiary of Grupo Galicia) due to an increase in the default rate may occur, with a corresponding negative impact on the results of Grupo Financiero Galicia. Q4, 2022

Restriction on the distribution of results by financial institutions. Q4, 2022

Grupo Financiero Galicia SA Peers Comparison

Overall Rating

UnderperformOutperform

Sector (68)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BSAC	76 Outperform	$11.31B	10.11	24.13%	5.53%	12.43%	56.30%
GGAL	71 Outperform	$6.18B	5.53	22.42%	1.45%	-42.92%	-21.46%
BBAR	69 Neutral	$2.46B	8.04	13.26%	0.19%	-47.41%	-18.95%
SUPV	69 Neutral	$697.98M	10.71	8.59%	2.40%	-55.30%	-64.02%
Sector *	68 Neutral	$17.95B	11.54	10.27%	3.74%	9.64%	1.17%
AVAL	63 Neutral	$3.85B	9.85	9.57%	3.64%	-6.63%	241.66%
BMA	56 Neutral	$3.64B	9.31	10.91%	1.31%	-57.78%	-67.92%

* Financial Sector Average

Performance Comparison

GGAL

Grupo Financiero Galicia SA

39.48

-2.28

-5.46%

BMA

Banco Macro SA

58.17

-5.61

-8.80%

BSAC

Banco Santander Chile

24.10

4.68

24.10%

BBAR

Banco BBVA Argentina

12.35

0.90

7.86%

AVAL

Grupo Aval Acciones y Valores SA Pfd

3.35

1.38

70.05%

SUPV

Grupo Supervielle SA

7.78

0.07

0.91%

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: Apr 15, 2025