Are Investors Undervaluing Affiliated Managers Group (AMG) Right Now?
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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Affiliated Managers Group (AMG) is a stock many investors are watching right now. AMG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 7.37, which compares to its industry's average of 15.43. Over the last 12 months, AMG's Forward P/E has been as high as 8.28 and as low as 6.20, with a median of 7.02.
Investors will also notice that AMG has a PEG ratio of 0.58. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. AMG's industry currently sports an average PEG of 0.85. Over the past 52 weeks, AMG's PEG has been as high as 1.01 and as low as 0.55, with a median of 0.68.
Investors should also recognize that AMG has a P/B ratio of 1.20. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.79. AMG's P/B has been as high as 1.34 and as low as 0.95, with a median of 1.16, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. AMG has a P/S ratio of 2.58. This compares to its industry's average P/S of 2.78.
Finally, our model also underscores that AMG has a P/CF ratio of 9.11. 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. AMG's P/CF compares to its industry's average P/CF of 17.19. Over the past 52 weeks, AMG's P/CF has been as high as 9.11 and as low as 4, with a median of 4.74.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Affiliated Managers Group is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AMG feels like a great value stock at the moment.
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Affiliated Managers Group, Inc. (AMG) : Free Stock Analysis Report
