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Is American Financial Group (AFG) a Great Value Stock Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is American Financial Group (AFG - Free Report) . AFG is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 11.83 right now. For comparison, its industry sports an average P/E of 24.86. Over the past year, AFG's Forward P/E has been as high as 1,155.88 and as low as 11.68, with a median of 14.18.

Finally, investors should note that AFG has a P/CF ratio of 5.65. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.18. Over the past 52 weeks, AFG's P/CF has been as high as 6.42 and as low as 3.91, with a median of 4.88.

Investors could also keep in mind Everest Re Group , an Insurance - Property and Casualty stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Everest Re Group is trading at a forward earnings multiple of 7.27 at the moment, with a PEG ratio of 0.73. This compares to its industry's average P/E of 24.86 and average PEG ratio of 2.06.

RE's price-to-earnings ratio has been as high as 9.82 and as low as 7.16, with a median of 8.39, while its PEG ratio has been as high as 0.88 and as low as 0.17, with a median of 0.79, all within the past year.

Everest Re Group sports a P/B ratio of 1.39 as well; this compares to its industry's price-to-book ratio of 1.16. In the past 52 weeks, RE's P/B has been as high as 1.58, as low as 1, with a median of 1.17.

These are only a few of the key metrics included in American Financial Group and Everest Re Group strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, AFG and RE look like an impressive value stock at the moment.


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