Is AMC Networks (AMCX) a Great Value Stock Right Now?
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, 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
AMC Networks (AMCX) is a stock many investors are watching right now. AMCX is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
AMCX is also sporting a PEG ratio of 0.75. 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. AMCX's PEG compares to its industry's average PEG of 1.56. AMCX's PEG has been as high as 1.37 and as low as 0.63, with a median of 0.93, all within the past year.
We should also highlight that AMCX has a P/B ratio of 6.33. 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. AMCX's current P/B looks attractive when compared to its industry's average P/B of 18.09. Within the past 52 weeks, AMCX's P/B has been as high as 19.33 and as low as 6.12, with a median of 10.85.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. AMCX has a P/S ratio of 1.01. This compares to its industry's average P/S of 1.21.
These are only a few of the key metrics included in AMC Networks's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, AMCX looks like an impressive value stock at the moment.
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