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Is American Airlines (AAL) 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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is American Airlines (AAL - Free Report) . AAL 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 6.47, while its industry has an average P/E of 9.57. Over the past year, AAL's Forward P/E has been as high as 11.53 and as low as 5.67, with a median of 7.42.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. AAL has a P/S ratio of 0.36. This compares to its industry's average P/S of 0.62.
Finally, we should also recognize that AAL has a P/CF ratio of 5.16. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 5.82. Within the past 12 months, AAL's P/CF has been as high as 7.33 and as low as 4.59, with a median of 5.64.
These figures are just a handful of the metrics value investors tend to look at, but they help show that American Airlines is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AAL feels like a great value stock at the moment.
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Is American Airlines (AAL) a Great Value Stock Right Now?
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, 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is American Airlines (AAL - Free Report) . AAL 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 6.47, while its industry has an average P/E of 9.57. Over the past year, AAL's Forward P/E has been as high as 11.53 and as low as 5.67, with a median of 7.42.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. AAL has a P/S ratio of 0.36. This compares to its industry's average P/S of 0.62.
Finally, we should also recognize that AAL has a P/CF ratio of 5.16. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 5.82. Within the past 12 months, AAL's P/CF has been as high as 7.33 and as low as 4.59, with a median of 5.64.
These figures are just a handful of the metrics value investors tend to look at, but they help show that American Airlines is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AAL feels like a great value stock at the moment.