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Are Investors Undervaluing The Hanover Insurance Group (THG) Right Now?

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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.

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 company value investors might notice is The Hanover Insurance Group (THG). THG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 13.22. This compares to its industry's average Forward P/E of 25.76. THG's Forward P/E has been as high as 16.96 and as low as 11.90, with a median of 13.34, all within the past year.

THG is also sporting a PEG ratio of 0.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. THG's industry currently sports an average PEG of 2.13. THG's PEG has been as high as 2.80 and as low as 0.76, with a median of 1.65, all within the past year.

If you're looking for another solid Insurance - Property and Casualty value stock, take a look at United Fire Group (UFCS). UFCS is a # 2 (Buy) stock with a Value score of A.

United Fire Group sports a P/B ratio of 1.12 as well; this compares to its industry's price-to-book ratio of 1.21. In the past 52 weeks, UFCS's P/B has been as high as 1.12, as low as 0.63, with a median of 0.75.

Value investors will likely look at more than just these metrics, but the above data helps show that The Hanover Insurance Group and United Fire Group are likely undervalued currently. And when considering the strength of its earnings outlook, THG and UFCS sticks out as one of the market's strongest value stocks.


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The Hanover Insurance Group, Inc. (THG) : Free Stock Analysis Report
 
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