Back to top

Image: Bigstock

Are Investors Undervaluing Mobile TeleSystems (MBT) Right Now?

Read MoreHide Full Article

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 to watch right now is Mobile TeleSystems . MBT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 8.94 right now. For comparison, its industry sports an average P/E of 12.41. MBT's Forward P/E has been as high as 9.46 and as low as 6.17, with a median of 8.73, all within the past year.

We also note that MBT holds a PEG ratio of 0.90. 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. MBT's industry currently sports an average PEG of 1.10. Over the last 12 months, MBT's PEG has been as high as 1.90 and as low as 0.74, with a median of 0.90.

Finally, our model also underscores that MBT has a P/CF ratio of 3.67. 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. MBT's P/CF compares to its industry's average P/CF of 6.75. Over the past year, MBT's P/CF has been as high as 3.90 and as low as 2.26, with a median of 3.41.

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

Published in