Back to top

Image: Bigstock

Is ABM Industries (ABM) Stock Undervalued Right Now?

Read MoreHide Full Article

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 stock to keep an eye on is ABM Industries (ABM - Free Report) . ABM 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 11.11 right now. For comparison, its industry sports an average P/E of 30.40. Over the last 12 months, ABM's Forward P/E has been as high as 61.52 and as low as 10.01, with a median of 12.86.

Finally, our model also underscores that ABM has a P/CF ratio of 12.08. 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. ABM's current P/CF looks attractive when compared to its industry's average P/CF of 37.59. ABM's P/CF has been as high as 16.87 and as low as 6.55, with a median of 13.20, all within the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that ABM Industries is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ABM feels like a great value stock at the moment.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

ABM Industries Incorporated (ABM) - free report >>

Published in