Are Investors Undervaluing Pfizer (PFE) 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...
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Pfizer (PFE) is a stock many investors are watching right now. PFE is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 11.30 right now. For comparison, its industry sports an average P/E of 14.36. Over the past year, PFE's Forward P/E has been as high as 14.02 and as low as 10.19, with a median of 11.62.
Another valuation metric that we should highlight is PFE's P/B ratio of 3.29. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. PFE's current P/B looks attractive when compared to its industry's average P/B of 5.64. Within the past 52 weeks, PFE's P/B has been as high as 4.01 and as low as 2.91, with a median of 3.19.
Finally, our model also underscores that PFE has a P/CF ratio of 12.98. 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. PFE's current P/CF looks attractive when compared to its industry's average P/CF of 19.28. Over the past 52 weeks, PFE's P/CF has been as high as 17.35 and as low as 12.30, with a median of 14.08.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Pfizer is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PFE feels like a great value stock at the moment.
Zacks’ Top Picks to Cash in on Artificial Intelligence
This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Pfizer Inc. (PFE): Free Stock Analysis Report
To read this article on Zacks.com click here.