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.
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.
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.
One stock to keep an eye on is International Consolidated Airlines Group (ICAGY). ICAGY is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 6.61. This compares to its industry's average Forward P/E of 9.38. ICAGY's Forward P/E has been as high as 7.44 and as low as 4.41, with a median of 6.38, all within the past year.
If you're looking for another solid Transportation - Airline value stock, take a look at LATAM Airlines Group (LTM). LTM is a Zacks Rank of #2 (Buy) stock with a Value score of A.
LATAM Airlines Group is currently trading with a Forward P/E ratio of 8.88 while its PEG ratio sits at 0.40. Both of the company's metrics compare favorably to its industry's average P/E of 9.38 and average PEG ratio of 0.45.
Over the past year, LTM's P/E has been as high as 9.75, as low as 6.73, with a median of 8.47; its PEG ratio has been as high as 0.85, as low as 0.37, with a median of 0.57 during the same time period.
LATAM Airlines Group sports a P/B ratio of 15.77 as well; this compares to its industry's price-to-book ratio of 3.17. In the past 52 weeks, LTM's P/B has been as high as 17.18, as low as 8.79, with a median of 12.18.
Value investors will likely look at more than just these metrics, but the above data helps show that International Consolidated Airlines Group and LATAM Airlines Group are likely undervalued currently. And when considering the strength of its earnings outlook, ICAGY and LTM sticks out as one of the market's strongest value stocks.
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International Consolidated Airlines Group SA (ICAGY): Free Stock Analysis Report LATAM Airlines Group S.A. (LTM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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