Should Value Investors Buy Allegiant (ALGT) Stock?

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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 company value investors might notice is Allegiant (ALGT). ALGT is currently holding a Zacks Rank #2 (Buy) and a Value grade of A.

Investors will also notice that ALGT has a PEG ratio of 0.27. 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. ALGT's industry has an average PEG of 0.65 right now. Within the past year, ALGT's PEG has been as high as 5.12 and as low as 0.10, with a median of 0.29.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ALGT has a P/S ratio of 0.46. This compares to its industry's average P/S of 0.57.

Investors could also keep in mind Japan Airlines (JAPSY), another Transportation - Airline stock with a Zacks Rank of #1 (Strong Buy) and Value grade of A.

Furthermore, Japan Airlines holds a P/B ratio of 1.36 and its industry's price-to-book ratio is 3.67. JAPSY's P/B has been as high as 1.41, as low as 1.01, with a median of 1.17 over the past 12 months.

These are just a handful of the figures considered in Allegiant and Japan 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 ALGT and JAPSY is an impressive value stock right now.

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This article originally published on Zacks Investment Research (zacks.com).

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