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Are Investors Undervaluing Fly Leasing (FLY) Right Now?

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Fly Leasing (FLY). FLY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 10.64, while its industry has an average P/E of 15.72. Over the last 12 months, FLY's Forward P/E has been as high as 10.64 and as low as 1.10, with a median of 3.22.

Investors should also recognize that FLY has a P/B ratio of 0.44. Investors use the P/B ratio to look at a stock's market value versus 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 0.92. Within the past 52 weeks, FLY's P/B has been as high as 0.61 and as low as 0.14, with a median of 0.26.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. FLY has a P/S ratio of 1.17. This compares to its industry's average P/S of 1.81.

Finally, we should also recognize that FLY has a P/CF ratio of 1.46. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. FLY's current P/CF looks attractive when compared to its industry's average P/CF of 4.93. Over the past 52 weeks, FLY's P/CF has been as high as 1.46 and as low as 0.32, with a median of 0.75.

These are just a handful of the figures considered in Fly Leasing's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FLY is an impressive value stock right now.


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