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Is Eni SpA (E) Stock Undervalued Right Now?

Zacks Equity Research

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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.

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.

Eni SpA (E) is a stock many investors are watching right now. E 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 11.17, while its industry has an average P/E of 14.30. Over the past year, E's Forward P/E has been as high as 12.60 and as low as 8.36, with a median of 11.10.

Another notable valuation metric for E is its P/B ratio of 0.98. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. E's current P/B looks attractive when compared to its industry's average P/B of 1.14. E's P/B has been as high as 1.10 and as low as 0.91, with a median of 1, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. E has a P/S ratio of 0.63. This compares to its industry's average P/S of 0.64.

Finally, investors will want to recognize that E has a P/CF ratio of 4.50. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. E's P/CF compares to its industry's average P/CF of 5.50. E's P/CF has been as high as 5.01 and as low as 3.71, with a median of 4.47, all within the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Eni SpA is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, E feels like a great value stock at the moment.


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