Back to top

Are Investors Undervaluing JetBlue Airways (JBLU) Right Now?

Read MoreHide Full Article

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

JetBlue Airways (JBLU - Free Report) is a stock many investors are watching right now. JBLU is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 8.60, while its industry has an average P/E of 8.78. JBLU's Forward P/E has been as high as 11.94 and as low as 7.57, with a median of 9.20, all within the past year.

JBLU is also sporting a PEG ratio of 0.38. 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. JBLU's PEG compares to its industry's average PEG of 0.47. Within the past year, JBLU's PEG has been as high as 5.81 and as low as 0.38, with a median of 1.17.

Another valuation metric that we should highlight is JBLU's P/B ratio of 1.25. The P/B ratio pits a stock's market value against 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 2.65. Over the past 12 months, JBLU's P/B has been as high as 1.39 and as low as 1.04, with a median of 1.20.

Finally, we should also recognize that JBLU has a P/CF ratio of 6.16. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.23. JBLU's P/CF has been as high as 9.34 and as low as 4.03, with a median of 6.28, all within the past year.

These are just a handful of the figures considered in JetBlue Airways'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 JBLU is an impressive value stock right now.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

JetBlue Airways Corporation (JBLU) - free report >>

Published in