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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.
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 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 BorgWarner (BWA - Free Report) . BWA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 8.10, while its industry has an average P/E of 23.35. Over the past year, BWA's Forward P/E has been as high as 12.78 and as low as 7.16, with a median of 9.11.
Another notable valuation metric for BWA is its P/B ratio of 1.25. 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 stock's P/B looks attractive against its industry's average P/B of 3.63. Within the past 52 weeks, BWA's P/B has been as high as 1.66 and as low as 1.08, with a median of 1.45.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BWA has a P/S ratio of 0.62. This compares to its industry's average P/S of 0.84.
Finally, investors should note that BWA has a P/CF ratio of 6.49. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. BWA's P/CF compares to its industry's average P/CF of 20.11. Over the past year, BWA's P/CF has been as high as 9.15 and as low as 5.51, with a median of 6.90.
If you're looking for another solid Automotive - Original Equipment value stock, take a look at Modine Manufacturing (MOD - Free Report) . MOD is a # 2 (Buy) stock with a Value score of A.
Shares of Modine Manufacturing currently holds a Forward P/E ratio of 8.20, and its PEG ratio is 0.33. In comparison, its industry sports average P/E and PEG ratios of 23.35 and 1.20.
Over the past year, MOD's P/E has been as high as 9.45, as low as 4.54, with a median of 6.48; its PEG ratio has been as high as 0.94, as low as 0.29, with a median of 0.30 during the same time period.
Furthermore, Modine Manufacturing holds a P/B ratio of 1.72 and its industry's price-to-book ratio is 3.63. MOD's P/B has been as high as 2.31, as low as 0.87, with a median of 1.31 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 BorgWarner and Modine Manufacturing are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BWA and MOD feels like a great value stock at the moment.
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Is BorgWarner (BWA) Stock Undervalued Right Now?
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 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 BorgWarner (BWA - Free Report) . BWA is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 8.10, while its industry has an average P/E of 23.35. Over the past year, BWA's Forward P/E has been as high as 12.78 and as low as 7.16, with a median of 9.11.
Another notable valuation metric for BWA is its P/B ratio of 1.25. 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 stock's P/B looks attractive against its industry's average P/B of 3.63. Within the past 52 weeks, BWA's P/B has been as high as 1.66 and as low as 1.08, with a median of 1.45.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BWA has a P/S ratio of 0.62. This compares to its industry's average P/S of 0.84.
Finally, investors should note that BWA has a P/CF ratio of 6.49. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. BWA's P/CF compares to its industry's average P/CF of 20.11. Over the past year, BWA's P/CF has been as high as 9.15 and as low as 5.51, with a median of 6.90.
If you're looking for another solid Automotive - Original Equipment value stock, take a look at Modine Manufacturing (MOD - Free Report) . MOD is a # 2 (Buy) stock with a Value score of A.
Shares of Modine Manufacturing currently holds a Forward P/E ratio of 8.20, and its PEG ratio is 0.33. In comparison, its industry sports average P/E and PEG ratios of 23.35 and 1.20.
Over the past year, MOD's P/E has been as high as 9.45, as low as 4.54, with a median of 6.48; its PEG ratio has been as high as 0.94, as low as 0.29, with a median of 0.30 during the same time period.
Furthermore, Modine Manufacturing holds a P/B ratio of 1.72 and its industry's price-to-book ratio is 3.63. MOD's P/B has been as high as 2.31, as low as 0.87, with a median of 1.31 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 BorgWarner and Modine Manufacturing are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BWA and MOD feels like a great value stock at the moment.