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Is UBS (UBS) Stock Undervalued 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.

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 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.

UBS (UBS - Free Report) is a stock many investors are watching right now. UBS is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 9.18 right now. For comparison, its industry sports an average P/E of 9.83. Over the past year, UBS's Forward P/E has been as high as 11.19 and as low as 8.36, with a median of 9.49.

We should also highlight that UBS has a P/B ratio of 1.06. 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. UBS's current P/B looks attractive when compared to its industry's average P/B of 1.43. Over the past 12 months, UBS's P/B has been as high as 1.13 and as low as 0.86, with a median of 0.99.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. UBS has a P/S ratio of 1.83. This compares to its industry's average P/S of 2.01.

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


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