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Are Investors Undervaluing BNP Paribas SA (BNPQY) 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.

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 BNP Paribas SA (BNPQY - Free Report) . BNPQY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 9.66 right now. For comparison, its industry sports an average P/E of 10.88. Over the past 52 weeks, BNPQY's Forward P/E has been as high as 10.52 and as low as 3.97, with a median of 8.10.

Investors will also notice that BNPQY has a PEG ratio of 1.26. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BNPQY's industry currently sports an average PEG of 1.99. BNPQY's PEG has been as high as 2.94 and as low as 1.11, with a median of 1.91, all within the past year.

Another notable valuation metric for BNPQY is its P/B ratio of 0.58. 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. BNPQY's current P/B looks attractive when compared to its industry's average P/B of 0.97. Over the past 12 months, BNPQY's P/B has been as high as 0.59 and as low as 0.27, with a median of 0.42.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. BNPQY has a P/S ratio of 1.5. This compares to its industry's average P/S of 1.75.

Finally, investors will want to recognize that BNPQY has a P/CF ratio of 5.40. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. BNPQY's current P/CF looks attractive when compared to its industry's average P/CF of 13.73. BNPQY's P/CF has been as high as 5.56 and as low as 2.18, with a median of 3.68, all within the past year.

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


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