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Should Value Investors Buy Deutsche Bank (DB) Stock?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Deutsche Bank (DB - Free Report) is a stock many investors are watching right now. DB is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 5.97, while its industry has an average P/E of 8.18. Over the past 52 weeks, DB's Forward P/E has been as high as 6.50 and as low as 4.74, with a median of 5.34.

Investors should also note that DB holds a PEG ratio of 0.75. 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. DB's industry currently sports an average PEG of 0.80. Within the past year, DB's PEG has been as high as 0.99 and as low as 0.56, with a median of 0.67.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. DB has a P/S ratio of 0.44. This compares to its industry's average P/S of 1.22.

These are just a handful of the figures considered in Deutsche Bank'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 DB is an impressive value stock right now.


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