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Is Mercedes-Benz Group AG (MBGAF) Stock Undervalued 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.

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Mercedes-Benz Group AG (MBGAF - Free Report) . MBGAF is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 5.45, while its industry has an average P/E of 7.94. Over the last 12 months, MBGAF's Forward P/E has been as high as 6.09 and as low as 3.90, with a median of 5.17.

Investors should also recognize that MBGAF has a P/B ratio of 0.91. 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 solid versus its industry's average P/B of 1.61. MBGAF's P/B has been as high as 0.95 and as low as 0.65, with a median of 0.84, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. MBGAF has a P/S ratio of 0.51. This compares to its industry's average P/S of 0.64.

Finally, we should also recognize that MBGAF has a P/CF ratio of 3.68. 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 stock's P/CF looks attractive against its industry's average P/CF of 5.92. Within the past 12 months, MBGAF's P/CF has been as high as 3.91 and as low as 1.67, with a median of 2.18.

These are just a handful of the figures considered in Mercedes-Benz Group AG'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 MBGAF is an impressive value stock right now.

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