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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. 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 to watch right now is Aviva (AVVIY - Free Report) . AVVIY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 5.28 right now. For comparison, its industry sports an average P/E of 7.73. Over the last 12 months, AVVIY's Forward P/E has been as high as 7.46 and as low as 3.33, with a median of 6.01.
Another notable valuation metric for AVVIY is its P/B ratio of 0.62. 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. AVVIY's current P/B looks attractive when compared to its industry's average P/B of 1.32. AVVIY's P/B has been as high as 0.94 and as low as 0.40, with a median of 0.73, over the past year.
These are only a few of the key metrics included in Aviva'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, AVVIY looks like an impressive value stock at the moment.