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Are These Industrial Products Stocks Undervalued 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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company value investors might notice is Alcoa (AA - Free Report) . AA is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 10.05, while its industry has an average P/E of 11.01. Over the past 52 weeks, AA's Forward P/E has been as high as 20.06 and as low as 6.33, with a median of 9.02.

Investors should also recognize that AA has a P/B ratio of 2.34. 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. This stock's P/B looks solid versus its industry's average P/B of 2.79. AA's P/B has been as high as 2.34 and as low as 0.78, with a median of 1.53, over the past year.

Investors could also keep in mind Reliance Steel & Aluminum Co. (RS - Free Report) , an Metal Products - Distribution stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Over the last 12 months, RS's P/E has been as high as 16.19, as low as 7.89, with a median of 11.10, and its PEG ratio has been as high as 1.80, as low as 1.21, with a median of 1.57.

Furthermore, Reliance Steel & Aluminum Co. holds a P/B ratio of 1.80 and its industry's price-to-book ratio is 2.79. RS's P/B has been as high as 2.11, as low as 1.51, with a median of 1.72 over the past 12 months.

These are just a handful of the figures considered in Alcoa and Reliance Steel & Aluminum Co.'s great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that AA and RS is an impressive value stock right now.


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Alcoa (AA) - free report >>

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