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Are Investors Undervaluing Allstate (ALL) 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

Allstate (ALL - Free Report) is a stock many investors are watching right now. ALL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 9.40. This compares to its industry's average Forward P/E of 27.24. Over the last 12 months, ALL's Forward P/E has been as high as 12.14 and as low as 7.06, with a median of 10.73.

Investors will also notice that ALL has a PEG ratio of 1.25. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ALL's industry has an average PEG of 3.31 right now. ALL's PEG has been as high as 1.46 and as low as 0.85, with a median of 1.29, all within the past year.

We should also highlight that ALL has a P/B ratio of 1.35. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. ALL's current P/B looks attractive when compared to its industry's average P/B of 1.42. Over the past 12 months, ALL's P/B has been as high as 1.71 and as low as 1, with a median of 1.52.

Finally, we should also recognize that ALL has a P/CF ratio of 5.91. 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 stock's P/CF looks attractive against its industry's average P/CF of 15.10. Within the past 12 months, ALL's P/CF has been as high as 11.93 and as low as 4.27, with a median of 10.97.

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


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