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Should Value Investors Buy AAR (AIR) Stock?

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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, 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.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is AAR (AIR - Free Report) . AIR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 17.29 right now. For comparison, its industry sports an average P/E of 21.70. Over the last 12 months, AIR's Forward P/E has been as high as 68.34 and as low as 3.22, with a median of 17.18.

We should also highlight that AIR has a P/B ratio of 0.79. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. AIR's current P/B looks attractive when compared to its industry's average P/B of 1.49. Over the past year, AIR's P/B has been as high as 1.97 and as low as 0.36, with a median of 0.81.

These are only a few of the key metrics included in AAR'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, AIR looks like an impressive value stock at the moment.


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