Are Investors Undervaluing Erste Group Bank (EBKDY) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company to watch right now is Erste Group Bank (EBKDY). EBKDY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 5.42, which compares to its industry's average of 7.66. EBKDY's Forward P/E has been as high as 7.17 and as low as 4.70, with a median of 5.38, all within the past year.
Investors should also note that EBKDY holds a PEG ratio of 0.59. 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. EBKDY's industry has an average PEG of 0.60 right now. Within the past year, EBKDY's PEG has been as high as 1.06 and as low as 0.52, with a median of 0.72.
Another notable valuation metric for EBKDY is its P/B ratio of 0.58. 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 1.49. EBKDY's P/B has been as high as 0.64 and as low as 0.49, with a median of 0.53, over the past year.
Finally, we should also recognize that EBKDY has a P/CF ratio of 4.66. 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. EBKDY's current P/CF looks attractive when compared to its industry's average P/CF of 11.57. Within the past 12 months, EBKDY's P/CF has been as high as 6.40 and as low as 3.99, with a median of 4.86.
These are only a few of the key metrics included in Erste Group Bank's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, EBKDY looks like an impressive value stock at the moment.
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Erste Group Bank AG (EBKDY) : Free Stock Analysis Report
