Back to top

Image: Bigstock

Are Investors Undervaluing AudioCodes (AUDC) Right Now?

Read MoreHide Full Article

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.

One company value investors might notice is AudioCodes (AUDC - Free Report) . AUDC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 12.56 right now. For comparison, its industry sports an average P/E of 23.39. Over the last 12 months, AUDC's Forward P/E has been as high as 14.95 and as low as 7.48, with a median of 11.86.

Investors should also recognize that AUDC has a P/B ratio of 1.93. 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. This stock's P/B looks attractive against its industry's average P/B of 3.94. Over the past year, AUDC's P/B has been as high as 3.50 and as low as 1.27, with a median of 1.79.

Investors could also keep in mind Spirent Communications (SPMYY - Free Report) , an Communication - Components stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Additionally, Spirent Communications has a P/B ratio of 2.06 while its industry's price-to-book ratio sits at 3.94. For SPMYY, this valuation metric has been as high as 4.63, as low as 1.74, with a median of 3.06 over the past year.

These are only a few of the key metrics included in AudioCodes and Spirent Communications strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, AUDC and SPMYY look like an impressive value stock at the moment.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


AudioCodes Ltd. (AUDC) - free report >>

Spirent Communications PLC (SPMYY) - free report >>

Published in