Is Anthem (ANTM) a Great Value Stock 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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Anthem (ANTM). ANTM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 13.71, which compares to its industry's average of 14.03. Over the last 12 months, ANTM's Forward P/E has been as high as 17.02 and as low as 13.71, with a median of 15.40.
We also note that ANTM holds a PEG ratio of 0.93. 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. ANTM's PEG compares to its industry's average PEG of 1.04. Over the last 12 months, ANTM's PEG has been as high as 1.42 and as low as 0.93, with a median of 1.28.
We should also highlight that ANTM has a P/B ratio of 2.49. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. ANTM's current P/B looks attractive when compared to its industry's average P/B of 3.14. Over the past year, ANTM's P/B has been as high as 2.88 and as low as 2.08, with a median of 2.39.
These are just a handful of the figures considered in Anthem'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 ANTM is an impressive value stock right now.
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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.