The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.
One company to watch right now is Alaska Air Group (ALK). ALK is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.28, while its industry has an average P/E of 21.06. Over the past 52 weeks, ALK's Forward P/E has been as high as 12.12 and as low as 6.38, with a median of 7.91.
Investors should also note that ALK holds a PEG ratio of 0.66. 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. ALK's PEG compares to its industry's average PEG of 1.06. ALK's PEG has been as high as 1.17 and as low as 0.42, with a median of 0.57, all within the past year.
Another notable valuation metric for ALK is its P/B ratio of 1.83. 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. This stock's P/B looks attractive against its industry's average P/B of 4.70. Over the past 12 months, ALK's P/B has been as high as 1.90 and as low as 0.99, with a median of 1.25.
Another great Transportation - Airline stock you could consider is International Consolidated Airlines Group (ICAGY), which is a # 1 (Strong Buy) stock with a Value Score of A.
International Consolidated Airlines Group is currently trading with a Forward P/E ratio of 6.21 while its PEG ratio sits at 0.64. Both of the company's metrics compare favorably to its industry's average P/E of 21.06 and average PEG ratio of 1.06.
ICAGY's price-to-earnings ratio has been as high as 6.63 and as low as 3.80, with a median of 4.45, while its PEG ratio has been as high as 1.07 and as low as 0.07, with a median of 0.84, all within the past year.
International Consolidated Airlines Group also has a P/B ratio of 1.07 compared to its industry's price-to-book ratio of 4.70. Over the past year, its P/B ratio has been as high as 1.23, as low as 0.78, with a median of 1.01.
These are only a few of the key metrics included in Alaska Air Group and International Consolidated Airlines Group strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, ALK and ICAGY look like an impressive value stock at the moment.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
