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Is Amdocs (DOX) Stock Undervalued 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.

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.

Amdocs (DOX - Free Report) is a stock many investors are watching right now. DOX 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 13.79. This compares to its industry's average Forward P/E of 19.20. Over the past 52 weeks, DOX's Forward P/E has been as high as 16.30 and as low as 12.21, with a median of 13.93.

DOX is also sporting a PEG ratio of 1.62. 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. DOX's industry currently sports an average PEG of 1.84. Over the last 12 months, DOX's PEG has been as high as 2.05 and as low as 1.44, with a median of 1.64.

Finally, investors will want to recognize that DOX has a P/CF ratio of 15.01. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 41.54. Over the past year, DOX's P/CF has been as high as 16.75 and as low as 12.93, with a median of 14.84.

These are just a handful of the figures considered in Amdocs'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 DOX is an impressive value stock right now.


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