While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
Asbury Automotive Group (ABG) is a stock many investors are watching right now. ABG is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 9.12, while its industry has an average P/E of 9.55. Over the last 12 months, ABG's Forward P/E has been as high as 11.25 and as low as 7.67, with a median of 9.02.
We should also highlight that ABG has a P/B ratio of 1.28. Investors use the P/B ratio to look at a stock's market value versus 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 2.40. Over the past 12 months, ABG's P/B has been as high as 1.71 and as low as 1.14, with a median of 1.32.
Finally, we should also recognize that ABG has a P/CF ratio of 7.29. 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. ABG's current P/CF looks attractive when compared to its industry's average P/CF of 10.94. Within the past 12 months, ABG's P/CF has been as high as 11.08 and as low as 6.54, with a median of 8.63.
These are only a few of the key metrics included in Asbury Automotive Group'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, ABG looks like an impressive value stock at the moment.
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Asbury Automotive Group, Inc. (ABG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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