How Expensive is Philippine National Bank (PNB) Fundamentally?

Philippine National Bank (PNB) was incorporated on July 22, 1916 to engage in the general commercial banking business. PNB provides a range of banking and financial services to corporate, middle-market, small and medium enterprises and retail customers, including overseas Filipino workers, as well as to the Philippine national government, national government agencies, local government units and government-owned and -controlled corporations in the Philippines.

PNB's principal commercial banking activities include deposit-taking, lending, trade financing, foreign exchange dealings, bills discounting, fund transfers/remittance servicing, asset management, treasury operations, comprehensive trust services, retail banking and other related financial services. The Company'Ss banking activities are undertaken through the following groups namely, institutional banking; retail banking; consumer finance; global Filipino banking; treasury; trust banking; credit management; remedial management; and special assets management.

In December 2015, Allianz and PNB reached an agreement to enter into a 15-year exclusive distribution partnership on bancassurance products and for Allianz to acquire 51% of PNB Life Insurance Inc., the life insurance subsidiary of PNB. The joint venture company will operate under the name of "Allianz PNB Life Insurance, Inc."

As of December 31, 2015, PNB has a distribution network of 665 domestic branches and 75 overseas branches and 937 automated teller machines nationwide.

As of 13th of January 2017, PNB was last traded price at PHP 54.80. This is 37% lower compare to their recorded book value as of their September 2016 financial report. Therefore, in terms of price to book value, it's not expensive yet since the book value is higher than the market price. 

In terms of P/E, the company recorded a trailing P/E of 11.21 meaning, for every 1PHP earning last 2015, investors of this company are willing or is paying 11.21PHP only. With a 11.21 P/E and with a growth rate (change in EPS) of 6.3% from 2014 to 2015, the company trailing PEG ratio would be 1.78 which is more than 1.0 meaning, investors of this company are paying 11.21PHP for every 1PHP income last 2015 when the company grows only by 6.3% from 2014 to 2015. Ideally, a fair valued stocks has a PEG ratio of 1.0 meaning, the P/E is equal to the growth rate, in the case of PNB its more than one therefore, possibly overvalued.

In terms of income, the first 9 months net income (attributable to parent) last 2016 increases by 21.93% in comparison to 2015 first 9 months net income (attributable to parent).

As of this writing the annual report of this company for 2016 is not yet disclosed.

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