Joining me on PowerTalk today is Ed Bilek, the head of U.S. shareholder services for Banco Bilbao Vizcaya Argentaria SA (BBVA). While you may find it hard to believe, BBVA is arguably the next big bank you’ve probably never heard of.
Before we get to why that is, let’s step back a bit and talk about one of my PowerTrends — The Rise and Fall of the Middle Class. That PowerTrend — of my Great 8 PowerTrends — looks to capitalize on those companies positioned to benefit from rising disposable incomes in the emerging markets, as well as gains in more mature markets, like here in the United States or in the euro zone.
What would make a company even more interesting and the opportunity to own its shares even sweeter is if the business is benefitting from a regional to national strategy. A great example of this is Starbucks (SBUX), which is going from a regional presence to a more national one in China. Starbucks recently opened its 1,000th store in China during the June quarter, and it aims to have 1,500 locations throughout China by 2015. I recommended shares of Starbucks to subscribers of my investment newsletter, PowerTrend Profits, and the shares are up 71.5%, including dividends, since we added the position to our portfolio.
Another company that is embarking on a regional-to-national strategy is BBVA. For those who have not heard of BBVA before, it is the 35th-largest bank globally with assets north of $800 billion, according to Accuity. Headquartered in Spain, BBVA has a presence in more than 30 countries. It is not surprising that you may not have heard of BBVA here in the United States, since it was only a few years ago that the company made a concerted effort to enhance its U.S. footing when it bought Compass Bancshares.
Flash forward to today and BBVA Compass is the 22nd-largest bank in the United States, based on deposit market share data just released by the FDIC. Based on conversations I have had with management, its long-term goal is to grow BBVA into a top 10 U.S. bank. That’s a similar strategy embarked upon by Toronto Dominion Bank (TD), and it has served its shareholders well.
After listening to my PowerTalk with Ed Bilek, I suspect BBVA is a bank that you’ll at the very least want to keep your eyes on.
Listen to my behind-the-scenes PowerTalk conversation now, so you are even more in the know:
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