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Is Ambev (ABEV) a Great Value Stock 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Ambev (ABEV - Free Report) is a stock many investors are watching right now. ABEV is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 13.38, which compares to its industry's average of 15.57. ABEV's Forward P/E has been as high as 14.38 and as low as 9.82, with a median of 12.90, all within the past year.

Investors will also notice that ABEV has a PEG ratio of 2.48. 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. ABEV's industry currently sports an average PEG of 2.63. Over the last 12 months, ABEV's PEG has been as high as 7.28 and as low as 2.39, with a median of 5.00.

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


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