Back to top

Image: Bigstock

Are Investors Undervaluing Visteon (VC) Right Now?

Read MoreHide Full Article

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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Visteon (VC - Free Report) is a stock many investors are watching right now. VC is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.69. This compares to its industry's average Forward P/E of 18.24. VC's Forward P/E has been as high as 14.33 and as low as 8.02, with a median of 10.34, all within the past year.

Investors should also recognize that VC has a P/B ratio of 2.27. 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 stock's P/B looks attractive against its industry's average P/B of 3.28. Over the past 12 months, VC's P/B has been as high as 2.34 and as low as 1.31, with a median of 1.87.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. VC has a P/S ratio of 0.7. This compares to its industry's average P/S of 0.73.

These are only a few of the key metrics included in Visteon'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, VC looks like an impressive value stock at the moment.


See More Zacks Research for These Tickers


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


Visteon Corporation (VC) - free report >>

Published in