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Is The Hanover Insurance Group (THG) Stock Undervalued 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.

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.

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 The Hanover Insurance Group (THG - Free Report) . THG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 13.98, while its industry has an average P/E of 31.67. Over the past 52 weeks, THG's Forward P/E has been as high as 17.22 and as low as 11.90, with a median of 13.63.

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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. THG has a P/S ratio of 1.03. This compares to its industry's average P/S of 1.11.

Investors could also keep in mind Tokio Marine (TKOMY - Free Report) , an Insurance - Property and Casualty stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Tokio Marine is currently trading with a Forward P/E ratio of 13.17 while its PEG ratio sits at 0.45. Both of the company's metrics compare favorably to its industry's average P/E of 31.67 and average PEG ratio of 3.13.

Over the past year, TKOMY's P/E has been as high as 15.35, as low as 7.64, with a median of 10.27; its PEG ratio has been as high as 1.35, as low as 0.44, with a median of 1.72 during the same time period.

Furthermore, Tokio Marine holds a P/B ratio of 1.06 and its industry's price-to-book ratio is 1.39. TKOMY's P/B has been as high as 1.23, as low as 0.88, with a median of 0.99 over the past 12 months.

These figures are just a handful of the metrics value investors tend to look at, but they help show that The Hanover Insurance Group and Tokio Marine are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, THG and TKOMY feels like a great value stock at the moment.


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The Hanover Insurance Group, Inc. (THG) - free report >>

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