Back to top

Should Value Investors Buy Air Lease (AL) Stock?

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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

Air Lease (AL - Free Report) is a stock many investors are watching right now. AL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 6.40, while its industry has an average P/E of 11.99. AL's Forward P/E has been as high as 13.97 and as low as 6.28, with a median of 8.38, all within the past year.

Investors should also note that AL holds a PEG ratio of 0.75. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AL's PEG compares to its industry's average PEG of 1.18. Within the past year, AL's PEG has been as high as 1.65 and as low as 0.64, with a median of 1.13.

Another valuation metric that we should highlight is AL's P/B ratio of 0.88. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.35. Within the past 52 weeks, AL's P/B has been as high as 1.36 and as low as 0.86, with a median of 1.08.

Finally, we should also recognize that AL has a P/CF ratio of 2.94. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 4.33. Within the past 12 months, AL's P/CF has been as high as 5.93 and as low as 2.85, with a median of 3.69.

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

In-Depth Zacks Research for the Tickers Above

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

Air Lease Corporation (AL) - free report >>

More from Zacks Tale of the Tape

You May Like

Published in