That headline comes from the new teaser pitch for Global Income Edge, a newsletter that’s currently being helmed by Richard Stavros at Investing Daily — I’ve never written about this one before, it started publishing last year sometime and aims to be a relatively safe global income advisory, with a big focus on dividends (I know Stavros has done some writing for Investing Daily about utilities and energy stocks, but I haven’t seen him touted aggressively as a newsletter stock picker until now).

It looks like this has replaced Global Investment Strategist in the Investing Daily corral, so perhaps they’re going a bit “risk off” these days or just can’t sell the idea of overseas growth picks (Global Investment Strategist mostly teased emerging markets stocks, scoring some wins with names like Jollibee under other editors).

Stavros is teasing a bank as his number one pick — a European bank, no less — so he’s not afraid of being at least a little bit contrarian. And he says they pay a 3.7% dividend, never had to be bailed out during the financial crisis, and is “one of the most timely investment opportunities you’ll find anywhere in the world today…”

… so that sounded appealing, and worth a little Thinkolator time to chew on Stavros’ clues and get the name of this bank for you. Here’s how the ad begins:

“Finance Profits Are Back: BANKING 2.0

“Since 2008, U.S. and E.U. governments have spent $33.7 trillion bailing out financial institutions.

“But my top-secret “Banking 2.0” pick never took a penny of bailout money—and earned profits throughout the Great Recession….

“In addition to NOT requiring a cent in bailout money from any government or world financial entity, they continue to make money as recession continues to plague Europe.

“Let’s put this bank’s remarkable feat in perspective…

“My ‘Banking 2.0’ pick remained bailout-free and profitable while its own government was doling out $41.3 billion… and E.U. governments were forking over a total of $5 trillion to failing banks.”

OK … now, that’s probably enough to at least start throwing some guesses against the wall — but thankfully, Stavros makes it easier than that with a passel of other clues for us. Here are a few of them for those of you playing along at home:

“They’ve paid out 11%+ dividends in the past, and thanks to their new 2.0 strategy, we expect these hefty numbers to return soon.

“They continue to be profitable in recession-haunted Europe. (In their home country, their profits have tripled.) ….

“… with this stock, we find a classic case of unfair ‘guilt by association.’

“Actually, it’s a double case of unfair guilt.

“First, U.S. investors tend to shy away from big banks because they are habitually blamed from the highest pulpits of Washington for the crash of 2008 while being declared ‘too big to fail.’

“And second, Europe as a whole is viewed by American investors as a toxic economic environment—the home of persistent stagflation, perpetual labor unrest and endemic unemployment.”

Sounds reasonable — banks had a good year last year, not so good recently, but lots of folks still hate ’em… and I’d agree that the prevailing “wisdom” among individual investors is that Europe is in desperate straits (certainly the Euro has been falling as their Central Bank tries to push it down to spur growth, which makes the banks whose assets and earnings are mostly in Euros look worse once that money gets translated across the Atlantic).

A few more clues to help us ID this bank?

“… more than 13,000 branches globally and over 100 million customers in 40 countries worldwide….

“They have a notably strong presence in Latin America, where profits rose by 9% last year, and in the U.K., where profits rose by 34%….

“Their third-quarter profits this year rose 52%.”

And then…

“The stock’s current P/E ratio is just 14.7%, versus 15.9% for the banking industry and 18.6% for the S&P 500. It’s a flat-out bargain considering that they present a 235% money-doubling opportunity.

“Finally, they’ve won the “Best Bank in the World” award by prestigious British financial publication Euromoney three times in the last 7 years.”

Enough for the Thinkolator? I think so … took a few minutes to get it started on this frigid New England morning, but once it was chugging right along it didn’t take but a trice for the answer to come nice and clean out the other side… this is Banco Santander (SAN), which you might remember by its (unfortunate) old ticker symbol STD (they changed it about three years ago, taking back the SAN ticker from their Chilean subsidiary — which is now BSAC).

And yes, SAN trades for less than $9 — substantially less now, thanks to the big drop that came a few weeks ago when they raised capital and cut the dividend to improve their capital ratios, which may be a long-term positive for their financial health but was certainly taken negatively by shareholders (and it didn’t help that the announcement came just a day or two after they had hit a new 52-week low anyway, thanks to the panic about the possible Greek exit from the Euro).

The annual dividend is now 20 euro cents per year, a harsh drop from 60 cents, and they anticipate raising it over time to again be 30-40% of earnings in future years — so the current yield is about 3.3% (if it’s cash you’re looking for, the dividend is paid quarterly, three of the quarterly disbursements will be in cash and one in stock).

This is the biggest bank in the euro zone, and has indeed been reasonably resilient since the crisis on an operating basis — though they haven’t pleased US investors much, the stock is only about 20% above the 2009 (and 2012 euro crisis) low and is well off the post-crisis bounceback highs. They have been profitable every year, despite the very, very weak Spanish economy (much of their profits do come from overseas, they are a major Latin American player in Brazil, Chile and elsewhere, as well as having a substantial US presence and a big and growing UK business.

I’ll be curious to see how this plays out, Santander is in a transition now — their former leader, Emilio Botin, had built the bank up aggressively through acquisitions both in Spain and internationally (including Abbey Bank, which is why they have a large UK business) and focused on growth and, in recent years, on paying a substantial dividend based on the strong performance of their largely consumer-driven banking business. His oldest daughter Ana Botin, who took the reins (as was widely expected) after dad passed away in September, already seems a little bit different (the stories I’ve read indicated that her father resisted the pressure to raise equity or cut the dividend), so we’ll see. They did well in the Euro “stress tests,” and I imagine a lot will depend on how the economy does in Europe — their biggest loan markets are the UK and Spain, followed by the U.S. and Brazil, and about half of their profit comes from the Western Hemisphere (20% from Brazil, 10% from the US, the rest from throughout Latin America)… and, well, it’s truly a massive, global bank, so if you can figure it out in an hour or two of puttering around then you’re a wiser investor than I am. You can see their third quarter presentation here (they announced preliminary numbers for Q4 when they did their capital raise, but didn’t actually release the details yet) to get a better idea of where and how they operate.

As of now, their market cap of $82 billion puts them squarely inbetween their book value ($98 billion) and their tangible book value ($64 billion) — before the 2008 crisis, Santander tended to trade (like most profitable banks) at a premium to book value… during the crisis, and during the more recent Euro crises, it has occasionally dipped below tangible book but has bounced back pretty quickly each time. It’s rare for reasonable companies to trade at a significant discount to tangible book (the actual theoretical value of their assets in a liquidation — meaning, wishy-washy stuff like “goodwill” is taken out), but, well, it’s also rare for a major currency like the euro to fall 20% in a year (against the dollar), so I don’t know what’s going to happen with SAN. Tangible book value per share for them as of the last quarter was about $5.30, so if I were investing in this one somewhere around $5 is the downside risk I’d have in mind (though the currencies will change that value as they fluctuate) — or, for vultures, the point at which the stock becomes more attractive.

They are global, they may not get enough credit for the diversity of their income sources around the world, but they are still at their heart a half-European and half-Latin American bank, so currency fluctuations are a big part of the story for U.S. investors. I’d be more likely to dig deeper into Santander than into any other big European bank I can think of offhand, and the price drop this month has my ears pricked up a bit, but I have never owned shares and I’m not twitching to buy more stocks in the financial sector at the moment. How about you? Interested in SAN? Let us know with a comment below.