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Are Investors Undervaluing Andritz (ADRZY) Right Now?

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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, 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 company to watch right now is Andritz (ADRZY - Free Report) . ADRZY is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 11.5 right now. For comparison, its industry sports an average P/E of 28.61. Over the past 52 weeks, ADRZY's Forward P/E has been as high as 12.27 and as low as 7.77, with a median of 10.43.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ADRZY has a P/S ratio of 0.87. This compares to its industry's average P/S of 1.27.

Kion Group (KIGRY - Free Report) may be another strong Industrial Services stock to add to your shortlist. KIGRY is a Zacks Rank of #2 (Buy) stock with a Value grade of A.

Kion Group also has a P/B ratio of 1.25 compared to its industry's price-to-book ratio of 16.88. Over the past year, its P/B ratio has been as high as 1.25, as low as 0.61, with a median of 0.82.

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


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