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Should Value Investors Buy These Auto-Tires-Trucks Stocks?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Stellantis (STLA - Free Report) . STLA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
We should also highlight that STLA has a P/B ratio of 0.67. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.07. Within the past 52 weeks, STLA's P/B has been as high as 1.46 and as low as 0.62, with a median of 0.78.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. STLA has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.52.
Finally, our model also underscores that STLA has a P/CF ratio of 5.02. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.39. Over the past 52 weeks, STLA's P/CF has been as high as 5.84 and as low as 4.02, with a median of 5.03.
Toyota Motor (TM - Free Report) may be another strong Automotive - Foreign stock to add to your shortlist. TM is a # 1 (Strong Buy) stock with a Value grade of A.
Toyota Motor is trading at a forward earnings multiple of 8.96 at the moment, with a PEG ratio of 0.39. This compares to its industry's average P/E of 14.29 and average PEG ratio of 0.56.
Over the last 12 months, TM's P/E has been as high as 12.78, as low as 8.41, with a median of 9.70, and its PEG ratio has been as high as 1.49, as low as 0.36, with a median of 0.80.
Furthermore, Toyota Motor holds a P/B ratio of 1.12 and its industry's price-to-book ratio is 1.07. TM's P/B has been as high as 1.15, as low as 0.90, with a median of 1.06 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Stellantis and Toyota Motor are likely undervalued currently. And when considering the strength of its earnings outlook, STLA and TM sticks out as one of the market's strongest value stocks.
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Should Value Investors Buy These Auto-Tires-Trucks Stocks?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Stellantis (STLA - Free Report) . STLA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
We should also highlight that STLA has a P/B ratio of 0.67. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.07. Within the past 52 weeks, STLA's P/B has been as high as 1.46 and as low as 0.62, with a median of 0.78.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. STLA has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.52.
Finally, our model also underscores that STLA has a P/CF ratio of 5.02. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.39. Over the past 52 weeks, STLA's P/CF has been as high as 5.84 and as low as 4.02, with a median of 5.03.
Toyota Motor (TM - Free Report) may be another strong Automotive - Foreign stock to add to your shortlist. TM is a # 1 (Strong Buy) stock with a Value grade of A.
Toyota Motor is trading at a forward earnings multiple of 8.96 at the moment, with a PEG ratio of 0.39. This compares to its industry's average P/E of 14.29 and average PEG ratio of 0.56.
Over the last 12 months, TM's P/E has been as high as 12.78, as low as 8.41, with a median of 9.70, and its PEG ratio has been as high as 1.49, as low as 0.36, with a median of 0.80.
Furthermore, Toyota Motor holds a P/B ratio of 1.12 and its industry's price-to-book ratio is 1.07. TM's P/B has been as high as 1.15, as low as 0.90, with a median of 1.06 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Stellantis and Toyota Motor are likely undervalued currently. And when considering the strength of its earnings outlook, STLA and TM sticks out as one of the market's strongest value stocks.