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Is Invesco (IVZ) 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Invesco (IVZ - Free Report) . IVZ is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 8.07. This compares to its industry's average Forward P/E of 12.15. Over the last 12 months, IVZ's Forward P/E has been as high as 8.54 and as low as 3.24, with a median of 6.47.

IVZ is also sporting a PEG ratio of 1.35. 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. IVZ's PEG compares to its industry's average PEG of 1.63. Over the past 52 weeks, IVZ's PEG has been as high as 1.43 and as low as 0.41, with a median of 0.91.

Another valuation metric that we should highlight is IVZ's P/B ratio of 0.72. 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 stock's P/B looks solid versus its industry's average P/B of 1.96. IVZ's P/B has been as high as 0.84 and as low as 0.31, with a median of 0.51, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. IVZ has a P/S ratio of 1.21. This compares to its industry's average P/S of 2.64.

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


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