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Are Investors Undervaluing Regions Financial (RF) Right Now?

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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 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.

Regions Financial (RF - Free Report) is a stock many investors are watching right now. RF is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 8.94, which compares to its industry's average of 9.56. Over the last 12 months, RF's Forward P/E has been as high as 12.16 and as low as 7.77, with a median of 9.94.

RF is also sporting a PEG ratio of 0.53. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. RF's PEG compares to its industry's average PEG of 0.67. Within the past year, RF's PEG has been as high as 1.48 and as low as 0.27, with a median of 0.63.

We should also highlight that RF has a P/B ratio of 1.38. The P/B ratio is used to compare a stock's market value with 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 1.87. Over the past year, RF's P/B has been as high as 1.46 and as low as 1.11, with a median of 1.31.

Finally, our model also underscores that RF has a P/CF ratio of 7.92. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 12.16. RF's P/CF has been as high as 8.42 and as low as 6.22, with a median of 7.41, all within the past year.

These are just a handful of the figures considered in Regions Financial's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that RF is an impressive value stock right now.


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