Yahoo Finance Should Value Investors Buy Volvo (VLVLY) Stock?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
Volvo (VLVLY) is a stock many investors are watching right now. VLVLY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.19. This compares to its industry's average Forward P/E of 14.50. VLVLY's Forward P/E has been as high as 13.47 and as low as 8.95, with a median of 10.83, all within the past year.
Investors should also note that VLVLY holds a PEG ratio of 0.61. 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. VLVLY's industry has an average PEG of 0.67 right now. Over the past 52 weeks, VLVLY's PEG has been as high as 0.81 and as low as 0.54, with a median of 0.66.
Finally, investors will want to recognize that VLVLY has a P/CF ratio of 7.44. 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. VLVLY's P/CF compares to its industry's average P/CF of 23.37. VLVLY's P/CF has been as high as 9.10 and as low as 6.31, with a median of 7.54, all within the past year.
These are just a handful of the figures considered in Volvo's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that VLVLY is an impressive value stock right now.
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