Should Value Investors Buy Alaska Air Group (ALK) Stock?

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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.

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.

Alaska Air Group (ALK) is a stock many investors are watching right now. ALK is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.98, while its industry has an average P/E of 16.18. Over the past 52 weeks, ALK's Forward P/E has been as high as 9.26 and as low as 5.47, with a median of 7.28.

ALK is also sporting a PEG ratio of 0.80. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ALK's industry currently sports an average PEG of 0.81. ALK's PEG has been as high as 0.90 and as low as 0.25, with a median of 0.54, all within the past year.

We should also highlight that ALK has a P/B ratio of 1.40. 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. ALK's current P/B looks attractive when compared to its industry's average P/B of 3.63. ALK's P/B has been as high as 1.82 and as low as 0.97, with a median of 1.25, over the past year.

These are just a handful of the figures considered in Alaska Air Group'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 ALK is an impressive value stock right now.

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Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report

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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.

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