Are Investors Undervaluing Balfour Beatty PLC (BAFYY) 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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 stock to keep an eye on is Balfour Beatty PLC (BAFYY). BAFYY is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 9.28. This compares to its industry's average Forward P/E of 12.80. Over the last 12 months, BAFYY's Forward P/E has been as high as 9.89 and as low as 7.68, with a median of 9.28.
Investors should also recognize that BAFYY 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 attractive against its industry's average P/B of 1.82. Over the past 12 months, BAFYY's P/B has been as high as 1.65 and as low as 0.95, with a median of 1.27.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Balfour Beatty PLC is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BAFYY feels like a great value stock at the moment.
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