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Are Investors Undervaluing Imperial Tobacco Group (IMBBY) Right Now?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 value investors might notice is Imperial Tobacco Group (IMBBY - Free Report) . IMBBY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 6.42, which compares to its industry's average of 10.33. IMBBY's Forward P/E has been as high as 6.47 and as low as 5.33, with a median of 6.02, all within the past year.

Investors should also note that IMBBY holds a PEG ratio of 0.78. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. IMBBY's PEG compares to its industry's average PEG of 2.11. Within the past year, IMBBY's PEG has been as high as 1.03 and as low as 0.73, with a median of 0.84.

These are just a handful of the figures considered in Imperial Tobacco Group'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 IMBBY is an impressive value stock right now.


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