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Are Investors Undervaluing Sanofi (SNY) Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Sanofi (SNY - Free Report) is a stock many investors are watching right now. SNY 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 11.53, while its industry has an average P/E of 14.24. Over the last 12 months, SNY's Forward P/E has been as high as 13.99 and as low as 11.50, with a median of 12.88.

Investors should also note that SNY holds a PEG ratio of 1.27. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SNY's PEG compares to its industry's average PEG of 1.64. Over the past 52 weeks, SNY's PEG has been as high as 2.07 and as low as 1.24, with a median of 1.68.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. SNY has a P/S ratio of 2.8. This compares to its industry's average P/S of 3.65.

Finally, investors should note that SNY has a P/CF ratio of 10.93. 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 19.13. Within the past 12 months, SNY's P/CF has been as high as 12.06 and as low as 7.99, with a median of 10.90.

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


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