Yahoo Finance Are Investors Undervaluing Koninklijke Philips (PHG) Right Now?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Koninklijke Philips (PHG). PHG is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 15.72, while its industry has an average P/E of 21.89. Over the past year, PHG's Forward P/E has been as high as 25.96 and as low as 9.44, with a median of 13.69.
Investors will also notice that PHG has a PEG ratio of 0.94. 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. PHG's PEG compares to its industry's average PEG of 2.60. Over the past 52 weeks, PHG's PEG has been as high as 1.28 and as low as 0.85, with a median of 1.03.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. PHG has a P/S ratio of 0.96. This compares to its industry's average P/S of 1.56.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Koninklijke Philips is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PHG feels like a great value stock at the moment.
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Koninklijke Philips N.V. (PHG) : Free Stock Analysis Report
