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Are Investors Undervaluing Bayerische Motoren Werke (BAMXF) 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.

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.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company to watch right now is Bayerische Motoren Werke (BAMXF - Free Report) . BAMXF is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 6.60, which compares to its industry's average of 7.64. Over the past year, BAMXF's Forward P/E has been as high as 7.06 and as low as 3.09, with a median of 5.20.

Another valuation metric that we should highlight is BAMXF's P/B ratio of 0.68. The P/B ratio is used to compare a stock's market value with 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 0.97. BAMXF's P/B has been as high as 0.73 and as low as 0.43, with a median of 0.51, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BAMXF has a P/S ratio of 0.44. This compares to its industry's average P/S of 0.5.

Finally, we should also recognize that BAMXF has a P/CF ratio of 2.48. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 5.19. BAMXF's P/CF has been as high as 3.18 and as low as 1.57, with a median of 1.86, all within the past year.

These are just a handful of the figures considered in Bayerische Motoren Werke's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that BAMXF is an impressive value stock right now.


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