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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.
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.
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 company value investors might notice is AbbVie (ABBV - Free Report) . ABBV is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 7.85 right now. For comparison, its industry sports an average P/E of 14.42. ABBV's Forward P/E has been as high as 11.86 and as low as 7.23, with a median of 9.69, all within the past year.
Investors will also notice that ABBV has a PEG ratio of 1.41. 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. ABBV's industry has an average PEG of 1.77 right now. ABBV's PEG has been as high as 1.69 and as low as 0.67, with a median of 0.84, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ABBV has a P/S ratio of 3.13. This compares to its industry's average P/S of 4.07.
Finally, investors will want to recognize that ABBV has a P/CF ratio of 14.71. 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. ABBV's current P/CF looks attractive when compared to its industry's average P/CF of 15.23. Over the past year, ABBV's P/CF has been as high as 19.22 and as low as 12.74, with a median of 16.16.
These figures are just a handful of the metrics value investors tend to look at, but they help show that AbbVie is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ABBV feels like a great value stock at the moment.
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Should Value Investors Buy AbbVie (ABBV) Stock?
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.
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 company value investors might notice is AbbVie (ABBV - Free Report) . ABBV is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 7.85 right now. For comparison, its industry sports an average P/E of 14.42. ABBV's Forward P/E has been as high as 11.86 and as low as 7.23, with a median of 9.69, all within the past year.
Investors will also notice that ABBV has a PEG ratio of 1.41. 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. ABBV's industry has an average PEG of 1.77 right now. ABBV's PEG has been as high as 1.69 and as low as 0.67, with a median of 0.84, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ABBV has a P/S ratio of 3.13. This compares to its industry's average P/S of 4.07.
Finally, investors will want to recognize that ABBV has a P/CF ratio of 14.71. 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. ABBV's current P/CF looks attractive when compared to its industry's average P/CF of 15.23. Over the past year, ABBV's P/CF has been as high as 19.22 and as low as 12.74, with a median of 16.16.
These figures are just a handful of the metrics value investors tend to look at, but they help show that AbbVie is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ABBV feels like a great value stock at the moment.