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Is AerCap (AER) Stock Undervalued Right Now?

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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.

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.

AerCap (AER - Free Report) is a stock many investors are watching right now. AER 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 7.28. This compares to its industry's average Forward P/E of 8.03. Over the past year, AER's Forward P/E has been as high as 8.72 and as low as 5.58, with a median of 7.36.

Another notable valuation metric for AER is its P/B ratio of 0.85. 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 attractive against its industry's average P/B of 0.89. Within the past 52 weeks, AER's P/B has been as high as 0.99 and as low as 0.61, with a median of 0.84.

Finally, investors should note that AER has a P/CF ratio of 2.69. 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 2.82. Over the past 52 weeks, AER's P/CF has been as high as 3.25 and as low as 2.05, with a median of 2.69.

These are just a handful of the figures considered in AerCap's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that AER is an impressive value stock right now.


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