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Is AT&T (T) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

AT&T (T - Free Report) is a stock many investors are watching right now. T is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 9.24, which compares to its industry's average of 12.12. Over the past year, T's Forward P/E has been as high as 13.31 and as low as 8.69, with a median of 10.89.

Another notable valuation metric for T is its P/B ratio of 1.39. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.53. Over the past 12 months, T's P/B has been as high as 1.92 and as low as 1.26, with a median of 1.59.

Finally, investors should note that T has a P/CF ratio of 3.77. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 3.85. Over the past 52 weeks, T's P/CF has been as high as 6.55 and as low as 3.41, with a median of 4.23.

These are only a few of the key metrics included in AT&T's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, T looks like an impressive value stock at the moment.


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