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.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 Air China (AIRYY - Free Report) . AIRYY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 8.41, which compares to its industry's average of 9.36. AIRYY's Forward P/E has been as high as 21.43 and as low as 8.36, with a median of 14.37, all within the past year.
Another notable valuation metric for AIRYY is its P/B ratio of 1.01. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.99. AIRYY's P/B has been as high as 1.07 and as low as 0.23, with a median of 0.29, over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Air China is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AIRYY feels like a great value stock at the moment.