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Should Value Investors Buy Telefonica (TEF) Stock?
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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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 stock to keep an eye on is Telefonica (TEF - Free Report) . TEF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 12.40, while its industry has an average P/E of 16.53. Over the past 52 weeks, TEF's Forward P/E has been as high as 14.44 and as low as 10.58, with a median of 12.83.
We should also highlight that TEF has a P/B ratio of 0.83. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.13. TEF's P/B has been as high as 0.93 and as low as 0.62, with a median of 0.72, over the past year.
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. TEF has a P/S ratio of 0.56. This compares to its industry's average P/S of 1.27.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Telefonica is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TEF feels like a great value stock at the moment.
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Should Value Investors Buy Telefonica (TEF) Stock?
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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 stock to keep an eye on is Telefonica (TEF - Free Report) . TEF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 12.40, while its industry has an average P/E of 16.53. Over the past 52 weeks, TEF's Forward P/E has been as high as 14.44 and as low as 10.58, with a median of 12.83.
We should also highlight that TEF has a P/B ratio of 0.83. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.13. TEF's P/B has been as high as 0.93 and as low as 0.62, with a median of 0.72, over the past year.
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. TEF has a P/S ratio of 0.56. This compares to its industry's average P/S of 1.27.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Telefonica is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TEF feels like a great value stock at the moment.