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Is 21Vianet Group (VNET) a Great Value Stock Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

21Vianet Group (VNET - Free Report) is a stock many investors are watching right now. VNET is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.22, which compares to its industry's average of 20.58. Over the last 12 months, VNET's Forward P/E has been as high as 132.96 and as low as -128.68, with a median of -10.51.

We also note that VNET holds a PEG ratio of 0.35. 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. VNET's PEG compares to its industry's average PEG of 0.95. Within the past year, VNET's PEG has been as high as 0.57 and as low as -1, with a median of -0.29.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. VNET has a P/S ratio of 0.6. This compares to its industry's average P/S of 1.71.

These are just a handful of the figures considered in 21Vianet 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 VNET is an impressive value stock right now.


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