Back to top

Image: Bigstock

Are Investors Undervaluing AerCap (AER) Right Now?

Read MoreHide Full Article

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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

AerCap (AER - Free Report) is a stock many investors are watching right now. AER is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 7.36, which compares to its industry's average of 8.20. Over the last 12 months, AER's Forward P/E has been as high as 8.57 and as low as 5.58, with a median of 7.23.

We should also highlight that AER has a P/B ratio of 0.93. 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 company's current P/B looks solid when compared to its industry's average P/B of 0.98. Over the past year, AER's P/B has been as high as 0.98 and as low as 0.61, with a median of 0.84.

Finally, our model also underscores that AER has a P/CF ratio of 2.81. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. AER's current P/CF looks attractive when compared to its industry's average P/CF of 2.96. Within the past 12 months, AER's P/CF has been as high as 3.23 and as low as 2.05, with a median of 2.63.

Value investors will likely look at more than just these metrics, but the above data helps show that AerCap is likely undervalued currently. And when considering the strength of its earnings outlook, AER sticks out at as one of the market's strongest value stocks.


See More Zacks Research for These Tickers


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


Aercap Holdings N.V. (AER) - free report >>

Published in