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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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
One company value investors might notice is Aegon (AEG - Free Report) . AEG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 7.55, which compares to its industry's average of 10.15. AEG's Forward P/E has been as high as 8.87 and as low as 4.89, with a median of 6.80, all within the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AEG has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.79.
Finally, investors should note that AEG has a P/CF ratio of 5.59. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 10.08. AEG's P/CF has been as high as 5.59 and as low as 2.12, with a median of 3.13, all within the past year.
Investors could also keep in mind Radian Group (RDN - Free Report) , an Insurance - Multi line stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shares of Radian Group currently holds a Forward P/E ratio of 5.73, and its PEG ratio is 1.15. In comparison, its industry sports average P/E and PEG ratios of 10.15 and 1.67.
RDN's Forward P/E has been as high as 7.75 and as low as 5.53, with a median of 6.40. During the same time period, its PEG ratio has been as high as 1.55, as low as 1.11, with a median of 1.28.
Furthermore, Radian Group holds a P/B ratio of 0.80 and its industry's price-to-book ratio is 2.94. RDN's P/B has been as high as 1.04, as low as 0.76, with a median of 0.91 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Aegon and Radian Group are likely undervalued currently. And when considering the strength of its earnings outlook, AEG and RDN sticks out as one of the market's strongest value stocks.
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Are Investors Undervaluing Aegon (AEG) Right Now?
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
One company value investors might notice is Aegon (AEG - Free Report) . AEG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 7.55, which compares to its industry's average of 10.15. AEG's Forward P/E has been as high as 8.87 and as low as 4.89, with a median of 6.80, all within the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AEG has a P/S ratio of 0.52. This compares to its industry's average P/S of 0.79.
Finally, investors should note that AEG has a P/CF ratio of 5.59. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 10.08. AEG's P/CF has been as high as 5.59 and as low as 2.12, with a median of 3.13, all within the past year.
Investors could also keep in mind Radian Group (RDN - Free Report) , an Insurance - Multi line stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shares of Radian Group currently holds a Forward P/E ratio of 5.73, and its PEG ratio is 1.15. In comparison, its industry sports average P/E and PEG ratios of 10.15 and 1.67.
RDN's Forward P/E has been as high as 7.75 and as low as 5.53, with a median of 6.40. During the same time period, its PEG ratio has been as high as 1.55, as low as 1.11, with a median of 1.28.
Furthermore, Radian Group holds a P/B ratio of 0.80 and its industry's price-to-book ratio is 2.94. RDN's P/B has been as high as 1.04, as low as 0.76, with a median of 0.91 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Aegon and Radian Group are likely undervalued currently. And when considering the strength of its earnings outlook, AEG and RDN sticks out as one of the market's strongest value stocks.