Yahoo Finance Is Deutsche Telekom (DTEGY) Stock Undervalued Right Now?
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
One company to watch right now is Deutsche Telekom (DTEGY). DTEGY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 11.56, which compares to its industry's average of 15.61. Over the past 52 weeks, DTEGY's Forward P/E has been as high as 14.24 and as low as 11.16, with a median of 12.42.
Another valuation metric that we should highlight is DTEGY's P/B ratio of 1.17. 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. DTEGY's current P/B looks attractive when compared to its industry's average P/B of 2.22. Over the past 12 months, DTEGY's P/B has been as high as 1.32 and as low as 0.85, with a median of 1.01.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. DTEGY has a P/S ratio of 0.9. This compares to its industry's average P/S of 1.45.
If you're looking for another solid Diversified Communication Services value stock, take a look at Telefonica Brasil (VIV). VIV is a # 2 (Buy) stock with a Value score of A.
Shares of Telefonica Brasil currently holds a Forward P/E ratio of 13.46, and its PEG ratio is 2.96. In comparison, its industry sports average P/E and PEG ratios of 15.61 and 2.42.
Over the past year, VIV's P/E has been as high as 19.10, as low as 12.56, with a median of 15.33; its PEG ratio has been as high as 3.44, as low as 0.93, with a median of 0.82 during the same time period.
Additionally, Telefonica Brasil has a P/B ratio of 1.05 while its industry's price-to-book ratio sits at 2.22. For VIV, this valuation metric has been as high as 1.36, as low as 0.81, with a median of 0.98 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Deutsche Telekom and Telefonica Brasil are likely undervalued currently. And when considering the strength of its earnings outlook, DTEGY and VIV sticks out as one of the market's strongest value stocks.
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Deutsche Telekom AG (DTEGY) : Free Stock Analysis Report
Telefonica Brasil S.A. (VIV) : Free Stock Analysis Report
