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Are Investors Undervaluing Exelon (EXC) 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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One company value investors might notice is Exelon (EXC - Free Report) . EXC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

We should also highlight that EXC has a P/B ratio of 1.33. The P/B ratio is used to compare a stock's market value with 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 1.70. Over the past 12 months, EXC's P/B has been as high as 1.33 and as low as 1.08, with a median of 1.23.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. EXC has a P/S ratio of 1.25. This compares to its industry's average P/S of 1.85.

Finally, our model also underscores that EXC has a P/CF ratio of 4.33. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.70. Within the past 12 months, EXC's P/CF has been as high as 5.07 and as low as 3.56, with a median of 4.13.

These are just a handful of the figures considered in Exelon's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that EXC is an impressive value stock right now.


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