Back to top

Image: Bigstock

Should Value Investors Buy Embotelladora Andina (AKO.B) Stock?

Read MoreHide Full Article

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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Embotelladora Andina (AKO.B - Free Report) is a stock many investors are watching right now. AKO.B is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 13.93 right now. For comparison, its industry sports an average P/E of 18.24. Over the last 12 months, AKO.B's Forward P/E has been as high as 15.32 and as low as 10.00, with a median of 11.66.

We should also highlight that AKO.B has a P/B ratio of 3.68. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. AKO.B's current P/B looks attractive when compared to its industry's average P/B of 9.02. Within the past 52 weeks, AKO.B's P/B has been as high as 4.04 and as low as 2.09, with a median of 2.66.

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. AKO.B has a P/S ratio of 1.19. This compares to its industry's average P/S of 1.71.

Finally, investors will want to recognize that AKO.B has a P/CF ratio of 15.35. 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. AKO.B's current P/CF looks attractive when compared to its industry's average P/CF of 21.64. AKO.B's P/CF has been as high as 16.85 and as low as 10.83, with a median of 12.94, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Embotelladora Andina is likely undervalued currently. And when considering the strength of its earnings outlook, AKO.B sticks out as one of the market's strongest value stocks.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Embotelladora Andina S.A. (AKO.B) - free report >>

Published in