Yahoo Finance Should Value Investors Buy Reinsurance Group of America (RGA) Stock?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
Reinsurance Group of America (RGA) is a stock many investors are watching right now. RGA is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.
Investors should also recognize that RGA has a P/B ratio of 1.22. The P/B ratio is used to compare a stock's market value with 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 1.59. Over the past 12 months, RGA's P/B has been as high as 2.66 and as low as 0.79, with a median of 1.48.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. RGA has a P/S ratio of 0.58. This compares to its industry's average P/S of 0.7.
Finally, investors will want to recognize that RGA has a P/CF ratio of 10.48. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.79. Within the past 12 months, RGA's P/CF has been as high as 34.25 and as low as 9.81, with a median of 16.83.
Value investors will likely look at more than just these metrics, but the above data helps show that Reinsurance Group of America is likely undervalued currently. And when considering the strength of its earnings outlook, RGA sticks out at as one of the market's strongest value stocks.
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Reinsurance Group of America, Incorporated (RGA) : Free Stock Analysis Report
