Should Value Investors Buy United Rentals (URI) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.
United Rentals (URI) is a stock many investors are watching right now. URI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 10.36 right now. For comparison, its industry sports an average P/E of 13.20. URI's Forward P/E has been as high as 12.69 and as low as 7.49, with a median of 9.67, all within the past year.
URI is also sporting a PEG ratio of 0.57. 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. URI's industry has an average PEG of 1.51 right now. Within the past year, URI's PEG has been as high as 0.76 and as low as 0.43, with a median of 0.54.
Finally, investors should note that URI has a P/CF ratio of 6.65. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. URI's current P/CF looks attractive when compared to its industry's average P/CF of 15.59. Within the past 12 months, URI's P/CF has been as high as 7.87 and as low as 4.44, with a median of 5.96.
Value investors will likely look at more than just these metrics, but the above data helps show that United Rentals is likely undervalued currently. And when considering the strength of its earnings outlook, URI sticks out at as one of the market's strongest value stocks.
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United Rentals, Inc. (URI) : Free Stock Analysis Report
