Is Fresenius (FMS) Stock Undervalued 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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 to watch right now is Fresenius (FMS). FMS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

Investors will also notice that FMS has a PEG ratio of 1.78. 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. FMS's PEG compares to its industry's average PEG of 4.11. FMS's PEG has been as high as 2.86 and as low as 1.71, with a median of 2.12, all within the past year.

We should also highlight that FMS has a P/B ratio of 1.64. 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 company's current P/B looks solid when compared to its industry's average P/B of 4.08. Within the past 52 weeks, FMS's P/B has been as high as 1.86 and as low as 1.18, with a median of 1.66.

Finally, our model also underscores that FMS has a P/CF ratio of 7.14. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. FMS's P/CF compares to its industry's average P/CF of 24.60. FMS's P/CF has been as high as 8.30 and as low as 5.59, with a median of 7.42, all within the past year.

These are just a handful of the figures considered in Fresenius'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 FMS is an impressive value stock right now.

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Fresenius Medical Care AG & Co. KGaA (FMS) : Free Stock Analysis Report
 
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