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.
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 Aegon (AEG). AEG is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 7.51, while its industry has an average P/E of 8.76. Over the past year, AEG's Forward P/E has been as high as 12.62 and as low as 5.36, with a median of 6.58.
AEG is also sporting a PEG ratio of 0.25. 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. AEG's industry has an average PEG of 0.47 right now. Over the last 12 months, AEG's PEG has been as high as 0.29 and as low as 0.18, with a median of 0.25.
We should also highlight that AEG has a P/B ratio of 1.47. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. AEG's current P/B looks attractive when compared to its industry's average P/B of 2.33. Over the past 12 months, AEG's P/B has been as high as 1.59 and as low as 1.10, with a median of 1.37.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Aegon is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AEG feels like a great value stock at the moment.
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Aegon NV (AEG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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