Are Investors Undervaluing Subaru Corporation (FUJHY) 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

One stock to keep an eye on is Subaru Corporation (FUJHY). FUJHY is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.

Investors should also note that FUJHY holds a PEG ratio of 0.19. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FUJHY's industry currently sports an average PEG of 0.43. Over the past 52 weeks, FUJHY's PEG has been as high as 0.24 and as low as 0.15, with a median of 0.21.

We should also highlight that FUJHY has a P/B ratio of 0.82. 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 solid versus its industry's average P/B of 1.19. Within the past 52 weeks, FUJHY's P/B has been as high as 0.84 and as low as 0.64, with a median of 0.74.

Finally, investors will want to recognize that FUJHY has a P/CF ratio of 4.18. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.21. Over the past year, FUJHY's P/CF has been as high as 4.30 and as low as 2.77, with a median of 3.24.

Value investors will likely look at more than just these metrics, but the above data helps show that Subaru Corporation is likely undervalued currently. And when considering the strength of its earnings outlook, FUJHY sticks out as one of the market's strongest value stocks.

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This article originally published on Zacks Investment Research (zacks.com).

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