Back to top

Image: Bigstock

Are Investors Undervaluing RWE (RWEOY) Right Now?

Read MoreHide Full Article

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

RWE (RWEOY - Free Report) is a stock many investors are watching right now. RWEOY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with a P/E ratio of 11.32, which compares to its industry's average of 12.39. Over the last 12 months, RWEOY's Forward P/E has been as high as 14.36 and as low as 9.25, with a median of 12.06.

We also note that RWEOY holds a PEG ratio of 0.88. 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. RWEOY's PEG compares to its industry's average PEG of 2.07. Within the past year, RWEOY's PEG has been as high as 1.28 and as low as 0.56, with a median of 0.73.

We should also highlight that RWEOY has a P/B ratio of 1.10. 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. This stock's P/B looks solid versus its industry's average P/B of 1.41. Within the past 52 weeks, RWEOY's P/B has been as high as 1.25 and as low as 0.84, with a median of 1.09.

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


RWE AG (RWEOY) - free report >>

Published in