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Are Investors Undervaluing Voestalpine AG (VLPNY) 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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 stock to keep an eye on is Voestalpine AG (VLPNY - Free Report) . VLPNY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

Another valuation metric that we should highlight is VLPNY's P/B ratio of 1.28. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 3.16. VLPNY's P/B has been as high as 1.28 and as low as 0.67, with a median of 1.05, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. VLPNY has a P/S ratio of 0.58. This compares to its industry's average P/S of 0.97.

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


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