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Are Investors Undervaluing Denso (DNZOY) Right Now?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 company value investors might notice is Denso (DNZOY - Free Report) . DNZOY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 11.21, while its industry has an average P/E of 11.56. Over the last 12 months, DNZOY's Forward P/E has been as high as 14.37 and as low as 10.17, with a median of 11.90.

DNZOY is also sporting a PEG ratio of 0.93. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. DNZOY's PEG compares to its industry's average PEG of 1.27. DNZOY's PEG has been as high as 2.32 and as low as 0.93, with a median of 1.92, all within the past year.

Another notable valuation metric for DNZOY is its P/B ratio of 0.99. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. DNZOY's current P/B looks attractive when compared to its industry's average P/B of 2.47. Within the past 52 weeks, DNZOY's P/B has been as high as 1.20 and as low as 0.89, with a median of 1.03.

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


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