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Are Investors Undervaluing Mercedes-Benz Group AG (MBGAF) Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 company value investors might notice is Mercedes-Benz Group AG (MBGAF - Free Report) . MBGAF is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 5.47, while its industry has an average P/E of 7.59. Over the past year, 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 is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. MBGAF's current P/B looks attractive when compared to its industry's average P/B of 1.64. Over the past year, MBGAF's P/B has been as high as 0.95 and as low as 0.65, with a median of 0.84.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. MBGAF has a P/S ratio of 0.53. This compares to its industry's average P/S of 0.65.

Finally, investors should note that MBGAF has a P/CF ratio of 3.69. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6. Over the past year, MBGAF's P/CF has been as high as 3.91 and as low as 1.67, with a median of 2.19.

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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