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Is Bristol-Myers Squibb (BMY) Stock Undervalued 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.

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 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.

Bristol-Myers Squibb (BMY - Free Report) is a stock many investors are watching right now. BMY 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 9.35 right now. For comparison, its industry sports an average P/E of 16.12. Over the last 12 months, BMY's Forward P/E has been as high as 14.36 and as low as 7.25, with a median of 10.27.

Investors will also notice that BMY has a PEG ratio of 1.09. 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. BMY's PEG compares to its industry's average PEG of 2.09. Over the last 12 months, BMY's PEG has been as high as 2.22 and as low as 0.76, with a median of 1.26.

Investors should also recognize that BMY has a P/B ratio of 2.67. 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. This stock's P/B looks attractive against its industry's average P/B of 6.84. Over the past 12 months, BMY's P/B has been as high as 5.89 and as low as 2, with a median of 4.72.

These are only a few of the key metrics included in Bristol-Myers Squibb'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, BMY looks like an impressive value stock at the moment.


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