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Is Omnicom (OMC) a Great Value Stock 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 stock to keep an eye on is Omnicom (OMC - Free Report) . OMC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 8.42 right now. For comparison, its industry sports an average P/E of 12.65. Over the past year, OMC's Forward P/E has been as high as 14.13 and as low as 8.42, with a median of 12.59.

Investors should also note that OMC holds a PEG ratio of 1.51. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. OMC's industry has an average PEG of 1.56 right now. Over the past 52 weeks, OMC's PEG has been as high as 3 and as low as 1.51, with a median of 2.52.

Finally, we should also recognize that OMC has a P/CF ratio of 7.73. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. OMC's current P/CF looks attractive when compared to its industry's average P/CF of 15.93. Over the past year, OMC's P/CF has been as high as 12.02 and as low as 7.73, with a median of 11.15.

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


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