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Are Investors Undervaluing Alaska Air Group (ALK) 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.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is Alaska Air Group (ALK - Free Report) . ALK is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We also note that ALK holds a PEG ratio of 0.39. 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. ALK's industry has an average PEG of 0.47 right now. Within the past year, ALK's PEG has been as high as 6.21 and as low as 0.33, with a median of 1.57.

Another notable valuation metric for ALK is its P/B ratio of 1.96. 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 solid versus its industry's average P/B of 2.65. Over the past 12 months, ALK's P/B has been as high as 2.43 and as low as 1.76, with a median of 2.05.

These are only a few of the key metrics included in Alaska Air Group's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ALK looks like an impressive value stock at the moment.


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