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Are Investors Undervaluing American Axle & Manufacturing (AXL) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company value investors might notice is American Axle & Manufacturing (AXL - Free Report) . AXL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 4.54. This compares to its industry's average Forward P/E of 9.49. Over the past 52 weeks, AXL's Forward P/E has been as high as 5.68 and as low as 3.21, with a median of 4.40.
AXL is also sporting a PEG ratio of 0.56. 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. AXL's PEG compares to its industry's average PEG of 0.88. Over the last 12 months, AXL's PEG has been as high as 0.70 and as low as 0.40, with a median of 0.54.
Another valuation metric that we should highlight is AXL's P/B ratio of 0.84. 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 2.43. Over the past year, AXL's P/B has been as high as 1.42 and as low as 0.63, with a median of 1.06.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AXL has a P/S ratio of 0.21. This compares to its industry's average P/S of 0.38.
Finally, we should also recognize that AXL has a P/CF ratio of 1.74. 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 stock's P/CF looks attractive against its industry's average P/CF of 5.87. AXL's P/CF has been as high as 2.92 and as low as 1.30, with a median of 2.14, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that American Axle & Manufacturing is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AXL feels like a great value stock at the moment.
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Are Investors Undervaluing American Axle & Manufacturing (AXL) Right Now?
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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company value investors might notice is American Axle & Manufacturing (AXL - Free Report) . AXL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 4.54. This compares to its industry's average Forward P/E of 9.49. Over the past 52 weeks, AXL's Forward P/E has been as high as 5.68 and as low as 3.21, with a median of 4.40.
AXL is also sporting a PEG ratio of 0.56. 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. AXL's PEG compares to its industry's average PEG of 0.88. Over the last 12 months, AXL's PEG has been as high as 0.70 and as low as 0.40, with a median of 0.54.
Another valuation metric that we should highlight is AXL's P/B ratio of 0.84. 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 2.43. Over the past year, AXL's P/B has been as high as 1.42 and as low as 0.63, with a median of 1.06.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AXL has a P/S ratio of 0.21. This compares to its industry's average P/S of 0.38.
Finally, we should also recognize that AXL has a P/CF ratio of 1.74. 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 stock's P/CF looks attractive against its industry's average P/CF of 5.87. AXL's P/CF has been as high as 2.92 and as low as 1.30, with a median of 2.14, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that American Axle & Manufacturing is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AXL feels like a great value stock at the moment.