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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.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

One stock to keep an eye on is Albertsons Companies (ACI - Free Report) . ACI 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 8.29. This compares to its industry's average Forward P/E of 18.19. ACI's Forward P/E has been as high as 10.44 and as low as 7.46, with a median of 8.91, all within the past year.

We also note that ACI holds a PEG ratio of 1.66. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ACI's industry has an average PEG of 2.69 right now. Over the last 12 months, ACI's PEG has been as high as 2.09 and as low as 0.93, with a median of 1.78.

Investors should also recognize that ACI has a P/B ratio of 3.11. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 5.33. ACI's P/B has been as high as 4.06 and as low as 3.11, with a median of 3.56, over the past year.

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

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