Are Investors Undervaluing American Financial Group (AFG) 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 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.

American Financial Group (AFG) is a stock many investors are watching right now. AFG is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 11.01. This compares to its industry's average Forward P/E of 24.90. Over the past year, AFG's Forward P/E has been as high as 1,155.88 and as low as 10.14, with a median of 13.62.

Finally, we should also recognize that AFG has a P/CF ratio of 9.78. 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. AFG's P/CF compares to its industry's average P/CF of 25.33. Over the past 52 weeks, AFG's P/CF has been as high as 10.69 and as low as 4.27, with a median of 5.68.

If you're looking for another solid Insurance - Property and Casualty value stock, take a look at Stewart Information Services (STC). STC is a # 2 (Buy) stock with a Value score of A.

Furthermore, Stewart Information Services holds a P/B ratio of 0.93 and its industry's price-to-book ratio is 1.36. STC's P/B has been as high as 1.77, as low as 0.85, with a median of 1.24 over the past 12 months.

These are only a few of the key metrics included in American Financial Group and Stewart Information Services strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, AFG and STC look like an impressive value stock at the moment.

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American Financial Group, Inc. (AFG) : Free Stock Analysis Report
 
Stewart Information Services Corporation (STC) : Free Stock Analysis Report
 
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