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Should Value Investors Buy Amer Movil (AMX) Stock?

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Zacks Equity Research
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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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 Amer Movil (AMX). AMX is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

AMX is also sporting a PEG ratio of 0.79. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. AMX's industry has an average PEG of 1.06 right now. Over the past 52 weeks, AMX's PEG has been as high as 1 and as low as 0.55, with a median of 0.74.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. AMX has a P/S ratio of 0.92. This compares to its industry's average P/S of 1.11.

Finally, investors should note that AMX has a P/CF ratio of 4.31. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 7.21. Within the past 12 months, AMX's P/CF has been as high as 4.93 and as low as 3.78, with a median of 4.42.

Value investors will likely look at more than just these metrics, but the above data helps show that Amer Movil is likely undervalued currently. And when considering the strength of its earnings outlook, AMX sticks out at as one of the market's strongest value stocks.


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