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Is Ryder (R) Stock Undervalued 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.

Ryder (R - Free Report) is a stock many investors are watching right now. R is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 12.68, while its industry has an average P/E of 15.52. Over the past year, R's Forward P/E has been as high as 19.35 and as low as 11.07, with a median of 13.16.

We also note that R holds a PEG ratio of 0.84. 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. R's PEG compares to its industry's average PEG of 1.45. Over the last 12 months, R's PEG has been as high as 1.29 and as low as 0.74, with a median of 0.88.

Another notable valuation metric for R is its P/B ratio of 1.47. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.66. R's P/B has been as high as 2.13 and as low as 1.23, with a median of 1.46, over the past year.

Finally, investors should note that R has a P/CF ratio of 1.96. 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. R's current P/CF looks attractive when compared to its industry's average P/CF of 5.62. R's P/CF has been as high as 3.02 and as low as 1.67, with a median of 1.97, all within the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Ryder is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, R feels like a great value stock at the moment.


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