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Is Orix (IX) a Great Value Stock Right Now?

Zacks Equity Research
Texas Capital (TCBI) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Orix (IX) is a stock many investors are watching right now. IX 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 6.66. This compares to its industry's average Forward P/E of 9.89. Over the last 12 months, IX's Forward P/E has been as high as 9.14 and as low as 6.48, with a median of 7.81.

We also note that IX holds a PEG ratio of 0.93. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. IX's industry has an average PEG of 1.03 right now. Over the last 12 months, IX's PEG has been as high as 1.11 and as low as 0.85, with a median of 0.95.

We should also highlight that IX has a P/B ratio of 0.79. 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 1.98. Over the past year, IX's P/B has been as high as 1.03 and as low as 0.76, with a median of 0.88.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Orix is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, IX feels like a great value stock at the moment.


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