Is KB Financial (KB) Stock Undervalued Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
KB Financial (KB) is a stock many investors are watching right now. KB is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 5.73 right now. For comparison, its industry sports an average P/E of 9.41. KB's Forward P/E has been as high as 6.01 and as low as 2.86, with a median of 5.07, all within the past year.
We also note that KB holds a PEG ratio of 1.16. 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. KB's industry currently sports an average PEG of 1.72. Over the last 12 months, KB's PEG has been as high as 1.79 and as low as 0.58, with a median of 1.03.
We should also highlight that KB has a P/B ratio of 0.45. 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 0.54 and as low as 0.26, with a median of 0.41.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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 0.96. This compares to its industry's average P/S of 1.11.
Finally, our model also underscores that KB has a P/CF ratio of 3.98. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.73. KB's P/CF has been as high as 5.26 and as low as 2.23, with a median of 3.58, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that KB Financial is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, KB feels like a great 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.