Is Bayer (BAYRY) a Great Value Stock Right Now?
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.
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 value investors might notice is Bayer (BAYRY). BAYRY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 6.09 right now. For comparison, its industry sports an average P/E of 15.27. Over the past year, BAYRY's Forward P/E has been as high as 9.15 and as low as 5.43, with a median of 7.28.
BAYRY is also sporting a PEG ratio of 1.06. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. BAYRY's industry currently sports an average PEG of 1.39. Over the past 52 weeks, BAYRY's PEG has been as high as 3.45 and as low as 0.94, with a median of 1.91.
Finally, we should also recognize that BAYRY has a P/CF ratio of 5.53. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. BAYRY's current P/CF looks attractive when compared to its industry's average P/CF of 15.22. Within the past 12 months, BAYRY's P/CF has been as high as 14.19 and as low as 4.92, with a median of 11.55.
Investors could also keep in mind Innoviva (INVA), an Large Cap Pharmaceuticals stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Additionally, Innoviva has a P/B ratio of 1.63 while its industry's price-to-book ratio sits at 5.59. For INVA, this valuation metric has been as high as 2.68, as low as 1.43, with a median of 2.06 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Bayer and Innoviva are likely undervalued currently. And when considering the strength of its earnings outlook, BAYRY and INVA sticks out as one of the market's strongest value stocks.
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
Bayer Aktiengesellschaft (BAYRY) : Free Stock Analysis Report
Innoviva, Inc. (INVA) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
