Should Value Investors Buy Millicom International Cellular (TIGO) Stock?

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.

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.

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.

Millicom International Cellular (TIGO) is a stock many investors are watching right now. TIGO is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

We should also highlight that TIGO has a P/B ratio of 1.89. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.11. Within the past 52 weeks, TIGO's P/B has been as high as 1.89 and as low as 0.68, with a median of 1.36.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. TIGO has a P/S ratio of 1.12. This compares to its industry's average P/S of 1.14.

Finally, investors should note that TIGO has a P/CF ratio of 4.03. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. TIGO's P/CF compares to its industry's average P/CF of 5.14. TIGO's P/CF has been as high as 4.04 and as low as 2.77, with a median of 3.14, all within the past year.

Another great Wireless Non-US stock you could consider is TIM (TIMB), which is a # 2 (Buy) stock with a Value Score of A.

Shares of TIM are currently trading at a forward earnings multiple of 11.99 and a PEG ratio of 0.75 compared to its industry's P/E and PEG ratios of 10.57 and 0.71, respectively.

TIMB's Forward P/E has been as high as 12.53 and as low as 8.19, with a median of 10.69. During the same time period, its PEG ratio has been as high as 0.81, as low as 0.36, with a median of 0.58.

Additionally, TIM has a P/B ratio of 1.98 while its industry's price-to-book ratio sits at 2.11. For TIMB, this valuation metric has been as high as 2.06, as low as 1.13, with a median of 1.49 over the past year.

These are only a few of the key metrics included in Millicom International Cellular and TIM strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, TIGO and TIMB look like an impressive value stock at the moment.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

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

Zacks Investment Research