Should Value Investors Buy Axa (AXAHY) Stock?
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.
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.
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.
One company value investors might notice is Axa (AXAHY). AXAHY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 7.94, which compares to its industry's average of 9.96. Over the last 12 months, AXAHY's Forward P/E has been as high as 9.49 and as low as 6.47, with a median of 7.89.
We also note that AXAHY holds a PEG ratio of 1.02. 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. AXAHY's industry has an average PEG of 1.65 right now. Within the past year, AXAHY's PEG has been as high as 1.30 and as low as 0.39, 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 Axa is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, AXAHY feels like a great value stock at the moment.
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