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Are Investors Undervaluing Unum (UNM) Right Now?

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.

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 Unum (UNM). UNM is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 7.35. This compares to its industry's average Forward P/E of 10.46. UNM's Forward P/E has been as high as 13.19 and as low as 6.60, with a median of 9.11, all within the past year.

Investors should also note that UNM holds a PEG ratio of 0.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. UNM's PEG compares to its industry's average PEG of 1.27. Over the last 12 months, UNM's PEG has been as high as 1.88 and as low as 0.73, with a median of 1.32.

Investors should also recognize that UNM has a P/B ratio of 0.91. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.38. UNM's P/B has been as high as 1.37 and as low as 0.81, with a median of 1.12, over the past year.

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

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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