Is KB Financial (KB) Stock Undervalued 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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company to watch right now is KB Financial (KB). KB is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 5.04 right now. For comparison, its industry sports an average P/E of 10. KB's Forward P/E has been as high as 6.01 and as low as 2.86, with a median of 4.97, all within the past year.
KB is also sporting a PEG ratio of 1.02. 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. KB's industry currently sports an average PEG of 1.83. Over the past 52 weeks, KB's PEG has been as high as 1.86 and as low as 0.58, with a median of 1.06.
Another notable valuation metric for KB is its P/B ratio of 0.40. 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 attractive against its industry's average P/B of 0.97. Within the past 52 weeks, KB's P/B has been as high as 505.18 and as low as 0.26, with a median of 0.46.
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. KB has a P/S ratio of 0.84. This compares to its industry's average P/S of 1.16.
These are only a few of the key metrics included in KB Financial'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, KB looks like an impressive value stock at the moment.
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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.