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Is ANDRITZ AG (ADRZY) Stock Undervalued Right Now?

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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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

ANDRITZ AG (ADRZY - Free Report) is a stock many investors are watching right now. ADRZY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 11.49 right now. For comparison, its industry sports an average P/E of 14.32. Over the past 52 weeks, ADRZY's Forward P/E has been as high as 16.56 and as low as 9.60, with a median of 12.30.

Investors should also recognize that ADRZY has a P/B ratio of 2.74. 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. This company's current P/B looks solid when compared to its industry's average P/B of 5.98. Over the past 12 months, ADRZY's P/B has been as high as 3.43 and as low as 2.50, with a median of 2.93.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. ADRZY has a P/S ratio of 0.49. This compares to its industry's average P/S of 1.1.

Finally, investors should note that ADRZY has a P/CF ratio of 7.50. 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. ADRZY's current P/CF looks attractive when compared to its industry's average P/CF of 14.06. Over the past 52 weeks, ADRZY's P/CF has been as high as 9.21 and as low as 6.80, with a median of 8.01.

These figures are just a handful of the metrics value investors tend to look at, but they help show that ANDRITZ AG is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ADRZY feels like a great value stock at the moment.


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