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Is Aflac (AFL) 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.

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 value investors might notice is Aflac (AFL - Free Report) . AFL is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

We also note that AFL holds a PEG ratio of 1.89. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. AFL's industry currently sports an average PEG of 2.22. Within the past year, AFL's PEG has been as high as 3.48 and as low as 1.42, with a median of 1.80.

Finally, we should also recognize that AFL has a P/CF ratio of 5.64. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 5.73. Over the past 52 weeks, AFL's P/CF has been as high as 8.57 and as low as 4.06, with a median of 6.08.

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


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