Yahoo Finance Are Investors Undervaluing Arch Capital Group (ACGL) 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.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 company value investors might notice is Arch Capital Group (ACGL). ACGL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 11, which compares to its industry's average of 26.25. Over the last 12 months, ACGL's Forward P/E has been as high as 12.38 and as low as 9.40, with a median of 10.98.
Investors should also note that ACGL holds a PEG ratio of 1.10. 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. ACGL's PEG compares to its industry's average PEG of 2.44. Within the past year, ACGL's PEG has been as high as 1.24 and as low as 0.94, with a median of 1.10.
Finally, we should also recognize that ACGL has a P/CF ratio of 7.61. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 8.02. Over the past 52 weeks, ACGL's P/CF has been as high as 13.92 and as low as 6.22, with a median of 10.46.
These are only a few of the key metrics included in Arch Capital Group's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ACGL looks like an impressive value stock at the moment.
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Arch Capital Group Ltd. (ACGL) : Free Stock Analysis Report
