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Should Value Investors Buy Aviva (AVVIY) Stock?

Zacks Equity Research
·2-min read

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.

Aviva (AVVIY) is a stock many investors are watching right now. AVVIY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 5.34. This compares to its industry's average Forward P/E of 7.61. Over the last 12 months, AVVIY's Forward P/E has been as high as 7.46 and as low as 3.33, with a median of 5.56.

Another notable valuation metric for AVVIY is its P/B ratio of 0.63. The P/B ratio pits a stock's market value against 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 1.32. AVVIY's P/B has been as high as 0.94 and as low as 0.40, with a median of 0.62, over the past year.

These are only a few of the key metrics included in Aviva'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, AVVIY looks like an impressive value stock at the moment.


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