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Should Value Investors Buy Deutsche Telekom (DTEGY) Stock?
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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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is Deutsche Telekom (DTEGY - Free Report) . DTEGY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 11.87, which compares to its industry's average of 23.28. Over the past year, DTEGY's Forward P/E has been as high as 14.24 and as low as 11.16, with a median of 12.53.
Another notable valuation metric for DTEGY is its P/B ratio of 1.20. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.25. Within the past 52 weeks, DTEGY's P/B has been as high as 1.32 and as low as 0.85, with a median of 1.
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. DTEGY has a P/S ratio of 0.94. This compares to its industry's average P/S of 1.6.
Telefonica (TEF - Free Report) may be another strong Diversified Communication Services stock to add to your shortlist. TEF is a # 2 (Buy) stock with a Value grade of A.
Telefonica is trading at a forward earnings multiple of 18.11 at the moment, with a PEG ratio of 0.74. This compares to its industry's average P/E of 23.28 and average PEG ratio of 3.59.
Over the past year, TEF's P/E has been as high as 18.53, as low as 8.36, with a median of 13.63; its PEG ratio has been as high as 1.05, as low as 0.53, with a median of 0.84 during the same time period.
Additionally, Telefonica has a P/B ratio of 0.76 while its industry's price-to-book ratio sits at 2.25. For TEF, this valuation metric has been as high as 0.88, as low as 0.55, with a median of 0.70 over the past year.
These are only a few of the key metrics included in Deutsche Telekom and Telefonica strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, DTEGY and TEF look like an impressive value stock at the moment.
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Should Value Investors Buy Deutsche Telekom (DTEGY) Stock?
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 stock to keep an eye on is Deutsche Telekom (DTEGY - Free Report) . DTEGY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 11.87, which compares to its industry's average of 23.28. Over the past year, DTEGY's Forward P/E has been as high as 14.24 and as low as 11.16, with a median of 12.53.
Another notable valuation metric for DTEGY is its P/B ratio of 1.20. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.25. Within the past 52 weeks, DTEGY's P/B has been as high as 1.32 and as low as 0.85, with a median of 1.
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. DTEGY has a P/S ratio of 0.94. This compares to its industry's average P/S of 1.6.
Telefonica (TEF - Free Report) may be another strong Diversified Communication Services stock to add to your shortlist. TEF is a # 2 (Buy) stock with a Value grade of A.
Telefonica is trading at a forward earnings multiple of 18.11 at the moment, with a PEG ratio of 0.74. This compares to its industry's average P/E of 23.28 and average PEG ratio of 3.59.
Over the past year, TEF's P/E has been as high as 18.53, as low as 8.36, with a median of 13.63; its PEG ratio has been as high as 1.05, as low as 0.53, with a median of 0.84 during the same time period.
Additionally, Telefonica has a P/B ratio of 0.76 while its industry's price-to-book ratio sits at 2.25. For TEF, this valuation metric has been as high as 0.88, as low as 0.55, with a median of 0.70 over the past year.
These are only a few of the key metrics included in Deutsche Telekom and Telefonica strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, DTEGY and TEF look like an impressive value stock at the moment.