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Are Investors Undervaluing Innoviva (INVA) Right Now?

·2 min read

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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 Innoviva (INVA). INVA is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 10.28, while its industry has an average P/E of 16.05. Over the last 12 months, INVA's Forward P/E has been as high as 12 and as low as 5.73, with a median of 9.42.

We should also highlight that INVA has a P/B ratio of 3.46. 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 6.84. Over the past 12 months, INVA's P/B has been as high as 7.37 and as low as 2.40, with a median of 4.31.

Finally, we should also recognize that INVA has a P/CF ratio of 7.55. 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. INVA's P/CF compares to its industry's average P/CF of 16.51. Within the past 12 months, INVA's P/CF has been as high as 9.79 and as low as 2.83, with a median of 3.98.

These are only a few of the key metrics included in Innoviva'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, INVA looks like an impressive value stock at the moment.


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