Yahoo Finance Are Investors Undervaluing Reinsurance Group of America (RGA) 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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 value investors might notice is Reinsurance Group of America (RGA). RGA is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value.
Another valuation metric that we should highlight is RGA's P/B ratio of 1.45. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. RGA's current P/B looks attractive when compared to its industry's average P/B of 1.66. RGA's P/B has been as high as 1.45 and as low as 1.14, with a median of 1.23, over 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. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. RGA has a P/S ratio of 0.68. This compares to its industry's average P/S of 0.99.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Reinsurance Group of America is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, RGA feels like a great value stock at the moment.
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Reinsurance Group of America, Incorporated (RGA) : Free Stock Analysis Report
