U.S. Markets open in 8 hrs 37 mins

Should Value Investors Buy Orix (IX) Stock?

Zacks Equity Research
Kinder Morgan (KMI) 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.

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.

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 stock to keep an eye on is Orix (IX). 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 6.98. This compares to its industry's average Forward P/E of 10.56. IX's Forward P/E has been as high as 9.14 and as low as 6.48, with a median of 7.81, all within the past year.

We also note that IX holds a PEG ratio of 0.98. 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 currently sports an average PEG of 1.10. Over the past 52 weeks, 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 0.82. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 2.03. IX's P/B has been as high as 1.03 and as low as 0.76, with a median of 0.88, over the past year.

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


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Orix Corp Ads (IX) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.