We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Volkswagen (VWAGY) Stock Undervalued Right Now?
Read MoreHide Full Article
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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Volkswagen (VWAGY - Free Report) . VWAGY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 4.36, which compares to its industry's average of 8.72. Over the past 52 weeks, VWAGY's Forward P/E has been as high as 5 and as low as 3.33, with a median of 4.22.
Another valuation metric that we should highlight is VWAGY's P/B ratio of 0.36. The P/B ratio pits a stock's market value against 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 1.06. Over the past year, VWAGY's P/B has been as high as 0.45 and as low as 0.27, with a median of 0.36.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. VWAGY has a P/S ratio of 0.22. This compares to its industry's average P/S of 0.64.
Finally, our model also underscores that VWAGY has a P/CF ratio of 1.66. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. VWAGY's P/CF compares to its industry's average P/CF of 5.54. VWAGY's P/CF has been as high as 2.09 and as low as 1.27, with a median of 1.67, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Volkswagen is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VWAGY feels like a great value stock at the moment.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is Volkswagen (VWAGY) Stock Undervalued 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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Volkswagen (VWAGY - Free Report) . VWAGY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 4.36, which compares to its industry's average of 8.72. Over the past 52 weeks, VWAGY's Forward P/E has been as high as 5 and as low as 3.33, with a median of 4.22.
Another valuation metric that we should highlight is VWAGY's P/B ratio of 0.36. The P/B ratio pits a stock's market value against 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 1.06. Over the past year, VWAGY's P/B has been as high as 0.45 and as low as 0.27, with a median of 0.36.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. VWAGY has a P/S ratio of 0.22. This compares to its industry's average P/S of 0.64.
Finally, our model also underscores that VWAGY has a P/CF ratio of 1.66. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. VWAGY's P/CF compares to its industry's average P/CF of 5.54. VWAGY's P/CF has been as high as 2.09 and as low as 1.27, with a median of 1.67, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Volkswagen is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VWAGY feels like a great value stock at the moment.