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Are Investors Undervaluing PACCAR (PCAR) 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 stock to keep an eye on is PACCAR (PCAR - Free Report) . PCAR is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.24. This compares to its industry's average Forward P/E of 32.91. Over the last 12 months, PCAR's Forward P/E has been as high as 13.24 and as low as 9.44, with a median of 11.58.
Investors should also note that PCAR holds a PEG ratio of 1.32. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PCAR's industry has an average PEG of 2.93 right now. Within the past year, PCAR's PEG has been as high as 1.32 and as low as 0.94, with a median of 1.16.
Another notable valuation metric for PCAR is its P/B ratio of 3.30. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. PCAR's current P/B looks attractive when compared to its industry's average P/B of 4.07. PCAR's P/B has been as high as 3.30 and as low as 2.58, with a median of 2.91, over the past year.
Finally, we should also recognize that PCAR has a P/CF ratio of 10.64. 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. PCAR's P/CF compares to its industry's average P/CF of 16.18. Within the past 12 months, PCAR's P/CF has been as high as 11.24 and as low as 8.57, with a median of 9.92.
Value investors will likely look at more than just these metrics, but the above data helps show that PACCAR is likely undervalued currently. And when considering the strength of its earnings outlook, PCAR sticks out at as one of the market's strongest value stocks.
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Are Investors Undervaluing PACCAR (PCAR) Right Now?
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 stock to keep an eye on is PACCAR (PCAR - Free Report) . PCAR is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.24. This compares to its industry's average Forward P/E of 32.91. Over the last 12 months, PCAR's Forward P/E has been as high as 13.24 and as low as 9.44, with a median of 11.58.
Investors should also note that PCAR holds a PEG ratio of 1.32. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PCAR's industry has an average PEG of 2.93 right now. Within the past year, PCAR's PEG has been as high as 1.32 and as low as 0.94, with a median of 1.16.
Another notable valuation metric for PCAR is its P/B ratio of 3.30. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. PCAR's current P/B looks attractive when compared to its industry's average P/B of 4.07. PCAR's P/B has been as high as 3.30 and as low as 2.58, with a median of 2.91, over the past year.
Finally, we should also recognize that PCAR has a P/CF ratio of 10.64. 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. PCAR's P/CF compares to its industry's average P/CF of 16.18. Within the past 12 months, PCAR's P/CF has been as high as 11.24 and as low as 8.57, with a median of 9.92.
Value investors will likely look at more than just these metrics, but the above data helps show that PACCAR is likely undervalued currently. And when considering the strength of its earnings outlook, PCAR sticks out at as one of the market's strongest value stocks.