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Are Investors Undervaluing Ahold (ADRNY) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
One stock to keep an eye on is Ahold (ADRNY - Free Report) . ADRNY is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.42. This compares to its industry's average Forward P/E of 20.19. ADRNY's Forward P/E has been as high as 14.34 and as low as 10.52, with a median of 12.08, all within the past year.
Investors should also note that ADRNY holds a PEG ratio of 1.56. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ADRNY's PEG compares to its industry's average PEG of 3.20. Over the last 12 months, ADRNY's PEG has been as high as 2.68 and as low as 1.55, with a median of 1.93.
We should also highlight that ADRNY has a P/B ratio of 2.29. The P/B is a method of comparing a stock's market value to 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 6.11. Over the past year, ADRNY's P/B has been as high as 2.40 and as low as 1.68, with a median of 1.97.
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. ADRNY has a P/S ratio of 0.38. This compares to its industry's average P/S of 0.93.
Finally, investors will want to recognize that ADRNY has a P/CF ratio of 6.25. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. ADRNY's P/CF compares to its industry's average P/CF of 14.25. Over the past 52 weeks, ADRNY's P/CF has been as high as 6.54 and as low as 4.55, with a median of 5.35.
These are only a few of the key metrics included in Ahold's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ADRNY looks like an impressive value stock at the moment.
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Are Investors Undervaluing Ahold (ADRNY) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
One stock to keep an eye on is Ahold (ADRNY - Free Report) . ADRNY is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.42. This compares to its industry's average Forward P/E of 20.19. ADRNY's Forward P/E has been as high as 14.34 and as low as 10.52, with a median of 12.08, all within the past year.
Investors should also note that ADRNY holds a PEG ratio of 1.56. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. ADRNY's PEG compares to its industry's average PEG of 3.20. Over the last 12 months, ADRNY's PEG has been as high as 2.68 and as low as 1.55, with a median of 1.93.
We should also highlight that ADRNY has a P/B ratio of 2.29. The P/B is a method of comparing a stock's market value to 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 6.11. Over the past year, ADRNY's P/B has been as high as 2.40 and as low as 1.68, with a median of 1.97.
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. ADRNY has a P/S ratio of 0.38. This compares to its industry's average P/S of 0.93.
Finally, investors will want to recognize that ADRNY has a P/CF ratio of 6.25. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. ADRNY's P/CF compares to its industry's average P/CF of 14.25. Over the past 52 weeks, ADRNY's P/CF has been as high as 6.54 and as low as 4.55, with a median of 5.35.
These are only a few of the key metrics included in Ahold's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ADRNY looks like an impressive value stock at the moment.