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Is Penske Automotive Group (PAG) Stock 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.

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 company to watch right now is Penske Automotive Group (PAG - Free Report) . PAG is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

We should also highlight that PAG has a P/B ratio of 1.87. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.99. Over the past year, PAG's P/B has been as high as 2.31 and as low as 1.61, with a median of 1.96.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. PAG has a P/S ratio of 0.3. This compares to its industry's average P/S of 0.31.

If you're looking for another solid Automotive - Retail and Whole Sales value stock, take a look at Titan Machinery (TITN - Free Report) . TITN is a # 2 (Buy) stock with a Value score of A.

Titan Machinery also has a P/B ratio of 1.21 compared to its industry's price-to-book ratio of 1.99. Over the past year, its P/B ratio has been as high as 2.09, as low as 1.12, with a median of 1.61.

These are only a few of the key metrics included in Penske Automotive Group and Titan Machinery strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, PAG and TITN look like an impressive value stock at the moment.


In-Depth Zacks Research for the Tickers Above


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Penske Automotive Group, Inc. (PAG) - free report >>

Titan Machinery Inc. (TITN) - free report >>

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