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Should Value Investors Buy Mercedes-Benz Group AG (MBGAF) Stock?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

Mercedes-Benz Group AG (MBGAF - Free Report) is a stock many investors are watching right now. MBGAF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 4.98. This compares to its industry's average Forward P/E of 9.44. Over the last 12 months, MBGAF's Forward P/E has been as high as 6.09 and as low as 4.29, with a median of 5.45.

We should also highlight that MBGAF has a P/B ratio of 0.73. 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 1.36. Within the past 52 weeks, MBGAF's P/B has been as high as 0.95 and as low as 0.63, with a median of 0.84.

Finally, investors should note that MBGAF has a P/CF ratio of 3.07. 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. MBGAF's P/CF compares to its industry's average P/CF of 6.83. Over the past 52 weeks, MBGAF's P/CF has been as high as 3.96 and as low as 2.65, with a median of 3.56.

These are only a few of the key metrics included in Mercedes-Benz Group AG's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, MBGAF looks like an impressive value stock at the moment.


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