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Should Value Investors Buy Bayerische Motoren Werke (BAMXF) Stock?

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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.

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 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.

Bayerische Motoren Werke (BAMXF - Free Report) is a stock many investors are watching right now. BAMXF 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 6.18, which compares to its industry's average of 8.95. BAMXF's Forward P/E has been as high as 6.57 and as low as 4.26, with a median of 5.37, all within the past year.

Another valuation metric that we should highlight is BAMXF's P/B ratio of 0.49. 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 0.94. Over the past year, BAMXF's P/B has been as high as 0.72 and as low as 0.41, with a median of 0.54.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. BAMXF has a P/S ratio of 0.31. This compares to its industry's average P/S of 0.46.

Finally, investors will want to recognize that BAMXF has a P/CF ratio of 2.86. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. BAMXF's current P/CF looks attractive when compared to its industry's average P/CF of 4.56. Over the past 52 weeks, BAMXF's P/CF has been as high as 3.68 and as low as 2.31, with a median of 2.81.

These are only a few of the key metrics included in Bayerische Motoren Werke'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, BAMXF looks like an impressive value stock at the moment.


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