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Should Value Investors Buy Altra Industrial Motion (AIMC) Stock?

Zacks Equity Research
·2 min read

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Altra Industrial Motion (AIMC) is a stock many investors are watching right now. AIMC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 14.50, while its industry has an average P/E of 25.56. Over the past year, AIMC's Forward P/E has been as high as 17.74 and as low as 4.89, with a median of 12.39.

We also note that AIMC holds a PEG ratio of 0.97. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. AIMC's industry currently sports an average PEG of 2.73. Over the last 12 months, AIMC's PEG has been as high as 1.18 and as low as 0.90, with a median of 0.97.

Finally, investors should note that AIMC has a P/CF ratio of 9.39. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 17.17. Over the past year, AIMC's P/CF has been as high as 10.03 and as low as 3.22, with a median of 8.35.

These are only a few of the key metrics included in Altra Industrial Motion'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, AIMC looks like an impressive value stock at the moment.


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