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Should Value Investors Buy Sunrun (RUN) Stock?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Sunrun (RUN - Free Report) . RUN is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 13.51. This compares to its industry's average Forward P/E of 31.48. RUN's Forward P/E has been as high as 14.75 and as low as 5.59, with a median of 11.26, all within the past year.

Investors will also notice that RUN has a PEG ratio of 0.65. 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. RUN's PEG compares to its industry's average PEG of 1.64. RUN's PEG has been as high as 1.01 and as low as 0.29, with a median of 0.64, all within the past year.

Another valuation metric that we should highlight is RUN's P/B ratio of 1.43. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.63. Over the past year, RUN's P/B has been as high as 1.43 and as low as 0.72, with a median of 1.13.

Value investors will likely look at more than just these metrics, but the above data helps show that Sunrun is likely undervalued currently. And when considering the strength of its earnings outlook, RUN sticks out at as one of the market's strongest value stocks.


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