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Is Deutsche Telekom (DTEGY) a Great Value Stock Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 to watch right now is Deutsche Telekom (DTEGY - Free Report) . DTEGY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Investors will also notice that DTEGY has a PEG ratio of 1.25. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DTEGY's PEG compares to its industry's average PEG of 2.41. Over the past 52 weeks, DTEGY's PEG has been as high as 13.46 and as low as 1.25, with a median of 1.52.

Another valuation metric that we should highlight is DTEGY's P/B ratio of 1.48. 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 2.03. Over the past 12 months, DTEGY's P/B has been as high as 1.62 and as low as 1.32, with a median of 1.52.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. DTEGY has a P/S ratio of 0.84. This compares to its industry's average P/S of 1.03.

Finally, investors will want to recognize that DTEGY has a P/CF ratio of 3.82. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. DTEGY's P/CF compares to its industry's average P/CF of 9.58. Over the past year, DTEGY's P/CF has been as high as 4.19 and as low as 3.36, with a median of 3.72.

These are just a handful of the figures considered in Deutsche Telekom'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 DTEGY is an impressive value stock right now.


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