Is OMV (OMVJF) Stock Undervalued Right Now?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is OMV (OMVJF). OMVJF is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 3.20. This compares to its industry's average Forward P/E of 6.05. OMVJF's Forward P/E has been as high as 6.90 and as low as 3.19, with a median of 5.15, all within the past year.
Another notable valuation metric for OMVJF is its P/B ratio of 0.51. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.20. Within the past 52 weeks, OMVJF's P/B has been as high as 0.87 and as low as 0.50, with a median of 0.69.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. OMVJF has a P/S ratio of 0.26. This compares to its industry's average P/S of 0.45.
Finally, investors should note that OMVJF has a P/CF ratio of 1.80. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 5.41. Within the past 12 months, OMVJF's P/CF has been as high as 3.13 and as low as 1.77, with a median of 2.52.
Investors could also keep in mind Shell (SHEL), an Oil and Gas - Integrated - International stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Shell is currently trading with a Forward P/E ratio of 4.93 while its PEG ratio sits at 0.60. Both of the company's metrics compare favorably to its industry's average P/E of 6.05 and average PEG ratio of 0.45.
SHEL's Forward P/E has been as high as 9.46 and as low as 4.48, with a median of 7.03. During the same time period, its PEG ratio has been as high as 2.37, as low as 0.56, with a median of 1.74.
Shell sports a P/B ratio of 1.03 as well; this compares to its industry's price-to-book ratio of 1.20. In the past 52 weeks, SHEL's P/B has been as high as 1.31, as low as 0.87, with a median of 1.08.
These figures are just a handful of the metrics value investors tend to look at, but they help show that OMV and Shell are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, OMVJF and SHEL feels like a great value stock at the moment.
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