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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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is Ahold (ADRNY - Free Report) . ADRNY is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 12.51 right now. For comparison, its industry sports an average P/E of 18.02. Over the past 52 weeks, ADRNY's Forward P/E has been as high as 14.34 and as low as 11.40, with a median of 12.65.
Investors should also note that ADRNY holds a PEG ratio of 1.57. 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. ADRNY's industry currently sports an average PEG of 2.41. Within the past year, ADRNY's PEG has been as high as 2.68 and as low as 1.51, with a median of 1.90.
Investors should also recognize that ADRNY has a P/B ratio of 2.26. 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. ADRNY's current P/B looks attractive when compared to its industry's average P/B of 5.17. Within the past 52 weeks, ADRNY's P/B has been as high as 2.39 and as low as 1.78, with a median of 2.04.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ADRNY has a P/S ratio of 0.34. This compares to its industry's average P/S of 0.98.
Finally, we should also recognize that ADRNY has a P/CF ratio of 5.79. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 12.42. ADRNY's P/CF has been as high as 6.54 and as low as 5.03, with a median of 5.73, all within the past year.
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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Is Ahold (ADRNY) Stock Undervalued Right Now?
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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is Ahold (ADRNY - Free Report) . ADRNY is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 12.51 right now. For comparison, its industry sports an average P/E of 18.02. Over the past 52 weeks, ADRNY's Forward P/E has been as high as 14.34 and as low as 11.40, with a median of 12.65.
Investors should also note that ADRNY holds a PEG ratio of 1.57. 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. ADRNY's industry currently sports an average PEG of 2.41. Within the past year, ADRNY's PEG has been as high as 2.68 and as low as 1.51, with a median of 1.90.
Investors should also recognize that ADRNY has a P/B ratio of 2.26. 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. ADRNY's current P/B looks attractive when compared to its industry's average P/B of 5.17. Within the past 52 weeks, ADRNY's P/B has been as high as 2.39 and as low as 1.78, with a median of 2.04.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ADRNY has a P/S ratio of 0.34. This compares to its industry's average P/S of 0.98.
Finally, we should also recognize that ADRNY has a P/CF ratio of 5.79. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 12.42. ADRNY's P/CF has been as high as 6.54 and as low as 5.03, with a median of 5.73, all within the past year.
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.