Singapore markets closed
  • Straits Times Index

    3,270.98
    -11.90 (-0.36%)
     
  • Nikkei

    27,999.96
    -249.28 (-0.88%)
     
  • Hang Seng

    19,992.00
    -53.77 (-0.27%)
     
  • FTSE 100

    7,481.93
    -0.44 (-0.01%)
     
  • BTC-USD

    23,866.17
    +61.89 (+0.26%)
     
  • CMC Crypto 200

    557.77
    +14.89 (+2.74%)
     
  • S&P 500

    4,140.06
    -5.13 (-0.12%)
     
  • Dow

    32,832.54
    +29.04 (+0.09%)
     
  • Nasdaq

    12,644.46
    -13.14 (-0.10%)
     
  • Gold

    1,802.10
    -3.10 (-0.17%)
     
  • Crude Oil

    89.87
    -0.89 (-0.98%)
     
  • 10-Yr Bond

    2.7650
    0.0000 (0.00%)
     
  • FTSE Bursa Malaysia

    1,496.44
    +0.41 (+0.03%)
     
  • Jakarta Composite Index

    7,126.08
    +39.23 (+0.55%)
     
  • PSE Index

    6,468.97
    +34.73 (+0.54%)
     

Is Principal Financial Group (PFG) a Great Value Stock Right Now?

  • Oops!
    Something went wrong.
    Please try again later.
·3-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

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.

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.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Principal Financial Group (PFG). PFG is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 8.97 right now. For comparison, its industry sports an average P/E of 9.54. PFG's Forward P/E has been as high as 11.51 and as low as 8.83, with a median of 9.94, all within the past year.

Another notable valuation metric for PFG is its P/B ratio of 1.35. 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 2.18. PFG's P/B has been as high as 1.61 and as low as 0.98, with a median of 1.15, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PFG has a P/S ratio of 1.14. This compares to its industry's average P/S of 2.29.

Finally, our model also underscores that PFG has a P/CF ratio of 7.79. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. PFG's current P/CF looks attractive when compared to its industry's average P/CF of 11.72. Within the past 12 months, PFG's P/CF has been as high as 9.30 and as low as 7.20, with a median of 8.15.

These are only a few of the key metrics included in Principal Financial Group'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, PFG looks like an impressive value stock at the moment.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
To read this article on Zacks.com click here.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting