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Is Deutsche Lufthansa (DLAKY) Stock Undervalued 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.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company value investors might notice is Deutsche Lufthansa (DLAKY - Free Report) . DLAKY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 4.59, which compares to its industry's average of 9.66. Over the past 52 weeks, DLAKY's Forward P/E has been as high as 20.05 and as low as 4.14, with a median of 5.80.

We also note that DLAKY holds a PEG ratio of 0.20. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DLAKY's industry has an average PEG of 0.37 right now. Within the past year, DLAKY's PEG has been as high as 0.24 and as low as 0.16, with a median of 0.19.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. DLAKY has a P/S ratio of 0.25. This compares to its industry's average P/S of 0.39.

Finally, we should also recognize that DLAKY has a P/CF ratio of 1.93. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 5.36. DLAKY's P/CF has been as high as 4.03 and as low as 1.71, with a median of 2.77, all within the past year.

Another great Transportation - Airline stock you could consider is Controladora Vuela Compania de Aviacion, B. de C.V. (VLRS - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.

Controladora Vuela Compania de Aviacion, B. de C.V. is trading at a forward earnings multiple of 89.09 at the moment, with a PEG ratio of -2.17. This compares to its industry's average P/E of 9.66 and average PEG ratio of 0.37.

VLRS's price-to-earnings ratio has been as high as 6,243.17 and as low as -73,021.84, with a median of 9.57, while its PEG ratio has been as high as 644.96 and as low as -7,543.58, with a median of 0.47, all within the past year.

Controladora Vuela Compania de Aviacion, B. de C.V. sports a P/B ratio of 5.53 as well; this compares to its industry's price-to-book ratio of 3.29. In the past 52 weeks, VLRS's P/B has been as high as 8.02, as low as 3.47, with a median of 5.53.

These are only a few of the key metrics included in Deutsche Lufthansa and Controladora Vuela Compania de Aviacion, B. de C.V. strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, DLAKY and VLRS look like an impressive value stock at the moment.


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