Yahoo Finance Should Value Investors Buy Alaska Air Group (ALK) Stock?
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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 company to watch right now is Alaska Air Group (ALK). ALK is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 6.48. This compares to its industry's average Forward P/E of 8.66. ALK's Forward P/E has been as high as 10.07 and as low as 6.35, with a median of 8.51, all within the past year.
Investors should also recognize that ALK has a P/B ratio of 1.49. The P/B ratio pits a stock's market value against 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 3.83. ALK's P/B has been as high as 1.78 and as low as 1.27, with a median of 1.49, over the past year.
If you're looking for another solid Transportation - Airline value stock, take a look at United Airlines (UAL). UAL is a # 1 (Strong Buy) stock with a Value score of A.
Shares of United Airlines are currently trading at a forward earnings multiple of 4.79 and a PEG ratio of 0.10 compared to its industry's P/E and PEG ratios of 8.66 and 0.27, respectively.
Over the last 12 months, UAL's P/E has been as high as 23.59, as low as 4.51, with a median of 7.55, and its PEG ratio has been as high as 0.11, as low as 0.10, with a median of 0.11.
Additionally, United Airlines has a P/B ratio of 2.24 while its industry's price-to-book ratio sits at 3.83. For UAL, this valuation metric has been as high as 4.36, as low as 1.76, with a median of 2.81 over the past year.
These are just a handful of the figures considered in Alaska Air Group and United Airlines'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 and UAL is an impressive value stock right now.
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Alaska Air Group, Inc. (ALK) : Free Stock Analysis Report
United Airlines Holdings Inc (UAL) : Free Stock Analysis Report
