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Are Investors Undervaluing Billiton (BBL) Right Now?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Billiton (BBL - Free Report) is a stock many investors are watching right now. BBL is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.30, while its industry has an average P/E of 11.32. Over the past year, BBL's Forward P/E has been as high as 14.45 and as low as 6.64, with a median of 11.25.

Another notable valuation metric for BBL is its P/B ratio of 1.17. 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. BBL's current P/B looks attractive when compared to its industry's average P/B of 3.36. Within the past 52 weeks, BBL's P/B has been as high as 1.22 and as low as 0.49, with a median of 0.87.

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


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