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Are Investors Undervaluing AutoNation (AN) 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.
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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One stock to keep an eye on is AutoNation (AN - Free Report) . AN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 12.85, while its industry has an average P/E of 13.14. Over the last 12 months, AN's Forward P/E has been as high as 14.25 and as low as 7.26, with a median of 10.43.
We also note that AN holds a PEG ratio of 1.15. 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. AN's industry has an average PEG of 2.22 right now. Over the last 12 months, AN's PEG has been as high as 4.19 and as low as 0.90, with a median of 1.22.
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. AN has a P/S ratio of 0.39. This compares to its industry's average P/S of 0.53.
Finally, we should also recognize that AN has a P/CF ratio of 9.44. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.41. Within the past 12 months, AN's P/CF has been as high as 9.44 and as low as 3.99, with a median of 6.10.
Value investors will likely look at more than just these metrics, but the above data helps show that AutoNation is likely undervalued currently. And when considering the strength of its earnings outlook, AN sticks out at as one of the market's strongest value stocks.
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Are Investors Undervaluing AutoNation (AN) Right Now?
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.
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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One stock to keep an eye on is AutoNation (AN - Free Report) . AN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 12.85, while its industry has an average P/E of 13.14. Over the last 12 months, AN's Forward P/E has been as high as 14.25 and as low as 7.26, with a median of 10.43.
We also note that AN holds a PEG ratio of 1.15. 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. AN's industry has an average PEG of 2.22 right now. Over the last 12 months, AN's PEG has been as high as 4.19 and as low as 0.90, with a median of 1.22.
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. AN has a P/S ratio of 0.39. This compares to its industry's average P/S of 0.53.
Finally, we should also recognize that AN has a P/CF ratio of 9.44. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.41. Within the past 12 months, AN's P/CF has been as high as 9.44 and as low as 3.99, with a median of 6.10.
Value investors will likely look at more than just these metrics, but the above data helps show that AutoNation is likely undervalued currently. And when considering the strength of its earnings outlook, AN sticks out at as one of the market's strongest value stocks.