Is Invesco (IVZ) a Great Value Stock Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.
Invesco (IVZ) is a stock many investors are watching right now. IVZ is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 7.41. This compares to its industry's average Forward P/E of 12.29. Over the last 12 months, IVZ's Forward P/E has been as high as 8.33 and as low as 3.24, with a median of 6.46.
IVZ is also sporting a PEG ratio of 1.24. 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. IVZ's industry currently sports an average PEG of 1.65. IVZ's PEG has been as high as 1.40 and as low as 0.41, with a median of 0.85, all within the past year.
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. IVZ has a P/S ratio of 0.98. This compares to its industry's average P/S of 2.07.
Value investors will likely look at more than just these metrics, but the above data helps show that Invesco is likely undervalued currently. And when considering the strength of its earnings outlook, IVZ sticks out at as one of the market's strongest value stocks.
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