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Are Investors Undervaluing Southwest Airlines (LUV) Right Now?
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 stock to keep an eye on is Southwest Airlines (LUV - Free Report) . LUV is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.
We also note that LUV holds a PEG ratio of 0.40. 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. LUV's industry currently sports an average PEG of 0.48. LUV's PEG has been as high as 6.49 and as low as 0.39, with a median of 2.95, all within the past year.
Another valuation metric that we should highlight is LUV's P/B ratio of 2.13. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. LUV's current P/B looks attractive when compared to its industry's average P/B of 3.20. Within the past 52 weeks, LUV's P/B has been as high as 2.47 and as low as 1.46, with a median of 1.90.
These are only a few of the key metrics included in Southwest Airlines'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, LUV looks like an impressive value stock at the moment.
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Are Investors Undervaluing Southwest Airlines (LUV) Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 stock to keep an eye on is Southwest Airlines (LUV - Free Report) . LUV is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.
We also note that LUV holds a PEG ratio of 0.40. 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. LUV's industry currently sports an average PEG of 0.48. LUV's PEG has been as high as 6.49 and as low as 0.39, with a median of 2.95, all within the past year.
Another valuation metric that we should highlight is LUV's P/B ratio of 2.13. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. LUV's current P/B looks attractive when compared to its industry's average P/B of 3.20. Within the past 52 weeks, LUV's P/B has been as high as 2.47 and as low as 1.46, with a median of 1.90.
These are only a few of the key metrics included in Southwest Airlines'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, LUV looks like an impressive value stock at the moment.