Is AmerisourceBergen (ABC) a Great Value Stock Right Now?
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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 stock to keep an eye on is AmerisourceBergen (ABC). ABC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 12.20. This compares to its industry's average Forward P/E of 18.81. Over the last 12 months, ABC's Forward P/E has been as high as 13.01 and as low as 9.32, with a median of 11.42.
ABC is also sporting a PEG ratio of 1.71. 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. ABC's PEG compares to its industry's average PEG of 2.63. ABC's PEG has been as high as 1.83 and as low as 1.26, with a median of 1.48, all within the past year.
Finally, we should also recognize that ABC has a P/CF ratio of 9.98. 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. ABC's P/CF compares to its industry's average P/CF of 35.19. Over the past year, ABC's P/CF has been as high as 17.96 and as low as 8.34, with a median of 12.50.
These are just a handful of the figures considered in AmerisourceBergen's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ABC is an impressive value stock right now.
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