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Is Albertsons Companies (ACI) Stock Undervalued 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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

Albertsons Companies (ACI - Free Report) is a stock many investors are watching right now. ACI is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 8.29, while its industry has an average P/E of 19.07. Over the last 12 months, ACI's Forward P/E has been as high as 10.44 and as low as 7.46, with a median of 8.91.

We also note that ACI holds a PEG ratio of 1.66. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ACI's industry has an average PEG of 2.80 right now. Over the past 52 weeks, ACI's PEG has been as high as 2.09 and as low as 0.93, with a median of 1.78.

Another valuation metric that we should highlight is ACI's P/B ratio of 3.11. 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. This company's current P/B looks solid when compared to its industry's average P/B of 5.39. Over the past year, ACI's P/B has been as high as 4.06 and as low as 3.11, with a median of 3.56.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Albertsons Companies is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ACI feels like a great value stock at the moment.


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