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Is KBR (KBR) Stock Undervalued Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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.

KBR (KBR - Free Report) is a stock many investors are watching right now. KBR is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 11.99. This compares to its industry's average Forward P/E of 24.82. Over the past 52 weeks, KBR's Forward P/E has been as high as 19.21 and as low as 11.18, with a median of 13.12.

We also note that KBR holds a PEG ratio of 0.90. 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. KBR's PEG compares to its industry's average PEG of 1.65. Within the past year, KBR's PEG has been as high as 1.27 and as low as 0.75, with a median of 0.94.

We should also highlight that KBR has a P/B ratio of 4.22. The P/B ratio pits a stock's market value against 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 6.45. Within the past 52 weeks, KBR's P/B has been as high as 6.34 and as low as 3.94, with a median of 4.79.

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 preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. KBR has a P/S ratio of 0.57. This compares to its industry's average P/S of 1.55.

Value investors will likely look at more than just these metrics, but the above data helps show that KBR is likely undervalued currently. And when considering the strength of its earnings outlook, KBR sticks out as one of the market's strongest value stocks.

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