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Are Investors Undervaluing AAC Technologies (AACAY) 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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is AAC Technologies (AACAY - Free Report) . AACAY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 13.37. This compares to its industry's average Forward P/E of 20.74. Over the past 52 weeks, AACAY's Forward P/E has been as high as 19.02 and as low as 7.35, with a median of 12.63.

Another valuation metric that we should highlight is AACAY's P/B ratio of 2.52. 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 attractive against its industry's average P/B of 2.94. AACAY's P/B has been as high as 6.17 and as low as 2.21, with a median of 3.08, over the past year.

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


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