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Should Value Investors Buy United Airlines (UAL) Stock?
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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.
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.
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.
United Airlines (UAL - Free Report) is a stock many investors are watching right now. UAL is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 7.31. This compares to its industry's average Forward P/E of 15.66. UAL's Forward P/E has been as high as 9.45 and as low as 3.63, with a median of 5.02, all within the past year.
We also note that UAL holds a PEG ratio of 0.62. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. UAL's PEG compares to its industry's average PEG of 0.78. UAL's PEG has been as high as 1.13 and as low as 0.41, with a median of 0.65, all within the past year.
Another notable valuation metric for UAL is its P/B ratio of 2.51. The P/B is a method of comparing a stock's market value to 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 4.89. Over the past year, UAL's P/B has been as high as 2.95 and as low as 1.18, with a median of 1.84.
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. UAL has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.58.
Finally, our model also underscores that UAL has a P/CF ratio of 5.42. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 11.41. UAL's P/CF has been as high as 6.20 and as low as 2.20, with a median of 3.15, all within the past year.
These are just a handful of the figures considered in United Airlines'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 UAL is an impressive value stock right now.
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Should Value Investors Buy United Airlines (UAL) Stock?
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.
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.
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.
United Airlines (UAL - Free Report) is a stock many investors are watching right now. UAL is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 7.31. This compares to its industry's average Forward P/E of 15.66. UAL's Forward P/E has been as high as 9.45 and as low as 3.63, with a median of 5.02, all within the past year.
We also note that UAL holds a PEG ratio of 0.62. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. UAL's PEG compares to its industry's average PEG of 0.78. UAL's PEG has been as high as 1.13 and as low as 0.41, with a median of 0.65, all within the past year.
Another notable valuation metric for UAL is its P/B ratio of 2.51. The P/B is a method of comparing a stock's market value to 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 4.89. Over the past year, UAL's P/B has been as high as 2.95 and as low as 1.18, with a median of 1.84.
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. UAL has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.58.
Finally, our model also underscores that UAL has a P/CF ratio of 5.42. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 11.41. UAL's P/CF has been as high as 6.20 and as low as 2.20, with a median of 3.15, all within the past year.
These are just a handful of the figures considered in United Airlines'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 UAL is an impressive value stock right now.