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Is Freenet AG (FRTAF) Stock Undervalued Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Freenet AG (FRTAF - Free Report) . FRTAF is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Another notable valuation metric for FRTAF is its P/B ratio of 1.69. The P/B ratio is used to compare a stock's market value with 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 2.23. Over the past 12 months, FRTAF's P/B has been as high as 1.97 and as low as 1.51, with a median of 1.69.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. FRTAF has a P/S ratio of 0.81. This compares to its industry's average P/S of 0.91.

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


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