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Are Investors Undervaluing Old Republic International (ORI) 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, 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 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 stock to keep an eye on is Old Republic International (ORI - Free Report) . ORI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 9.84, while its industry has an average P/E of 9.94. ORI's Forward P/E has been as high as 10.83 and as low as 7.75, with a median of 9.36, all within the past year.

Another notable valuation metric for ORI is its P/B ratio of 1.16. The P/B ratio pits a stock's market value against 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 2.20. Over the past year, ORI's P/B has been as high as 1.28 and as low as 0.96, with a median of 1.14.

Finally, investors will want to recognize that ORI has a P/CF ratio of 7.58. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 9.68. Within the past 12 months, ORI's P/CF has been as high as 7.73 and as low as 4.28, with a median of 5.23.

Value investors will likely look at more than just these metrics, but the above data helps show that Old Republic International is likely undervalued currently. And when considering the strength of its earnings outlook, ORI sticks out at as one of the market's strongest value stocks.


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