Is Lennar (LEN) a Great Value Stock 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is Lennar (LEN). LEN is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 9.68. This compares to its industry's average Forward P/E of 11.48. LEN's Forward P/E has been as high as 12.14 and as low as 4.67, with a median of 10.12, all within the past year.
LEN is also sporting a PEG ratio of 1.12. 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. LEN's industry has an average PEG of 2.28 right now. Over the last 12 months, LEN's PEG has been as high as 3.76 and as low as 0.50, with a median of 1.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Lennar is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, LEN feels like a great value stock at the moment.
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