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Is Subaru Corporation (FUJHY) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Subaru Corporation (FUJHY - Free Report) is a stock many investors are watching right now. FUJHY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 6.24 right now. For comparison, its industry sports an average P/E of 9.69. Over the last 12 months, FUJHY's Forward P/E has been as high as 8.20 and as low as 5.71, with a median of 6.81.

Investors will also notice that FUJHY has a PEG ratio of 0.25. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. FUJHY's industry has an average PEG of 0.37 right now. FUJHY's PEG has been as high as 0.50 and as low as 0.24, with a median of 0.30, all within the past year.

Investors should also recognize that FUJHY has a P/B ratio of 0.86. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.20. Over the past year, FUJHY's P/B has been as high as 1 and as low as 0.76, with a median of 0.85.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. FUJHY has a P/S ratio of 0.45. This compares to its industry's average P/S of 0.71.

Finally, we should also recognize that FUJHY has a P/CF ratio of 3.64. 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 7.77. Over the past 52 weeks, FUJHY's P/CF has been as high as 5 and as low as 3.39, with a median of 3.99.

Another great Automotive - Foreign stock you could consider is Nissan Motor Co. (NSANY - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.

Nissan Motor Co. is trading at a forward earnings multiple of 5.86 at the moment, with a PEG ratio of 0.20. This compares to its industry's average P/E of 9.69 and average PEG ratio of 0.37.

Over the past year, NSANY's P/E has been as high as 13.36, as low as 5.18, with a median of 6.34; its PEG ratio has been as high as 0.61, as low as 0.18, with a median of 0.30 during the same time period.

Furthermore, Nissan Motor Co. holds a P/B ratio of 0.36 and its industry's price-to-book ratio is 1.20. NSANY's P/B has been as high as 0.43, as low as 0.30, with a median of 0.36 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 Subaru Corporation and Nissan Motor Co. are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FUJHY and NSANY feels like a great value stock at the moment.


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