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Are Investors Undervaluing AerCap (AER) 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.

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.

AerCap (AER - Free Report) is a stock many investors are watching right now. AER is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.51, while its industry has an average P/E of 9.13. AER's Forward P/E has been as high as 8.80 and as low as 7.46, with a median of 8.28, all within the past year.

We also note that AER holds a PEG ratio of 1.20. 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. AER's PEG compares to its industry's average PEG of 1.22. Within the past year, AER's PEG has been as high as 1.23 and as low as 0.62, with a median of 0.69.

Investors should also recognize that AER has a P/B ratio of 0.97. The P/B ratio pits a stock's market value against 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 0.98. Over the past year, AER's P/B has been as high as 1.02 and as low as 0.90, with a median of 0.97.

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


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