Back to top

Image: Bigstock

Is Stellantis (STLA) Stock Undervalued Right Now?

Read MoreHide Full Article

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is Stellantis (STLA - Free Report) . STLA is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 2.79, while its industry has an average P/E of 7.81. Over the past year, STLA's Forward P/E has been as high as 5.64 and as low as 2.64, with a median of 3.28.

Investors should also note that STLA holds a PEG ratio of 0.84. 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. STLA's PEG compares to its industry's average PEG of 1.31. Within the past year, STLA's PEG has been as high as 0.96 and as low as 0.07, with a median of 0.09.

Another valuation metric that we should highlight is STLA's P/B ratio of 0.64. 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. STLA's current P/B looks attractive when compared to its industry's average P/B of 0.86. STLA's P/B has been as high as 1.02 and as low as 0.52, with a median of 0.66, over the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Stellantis is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, STLA feels like a great value stock at the moment.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Stellantis N.V. (STLA) - free report >>

Published in