Are Investors Undervaluing Merck KGaA (MKKGY) 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.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.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.One stock to keep an eye on is Merck KGaA (MKKGY). MKKGY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.MKKGY is also sporting a PEG ratio of 1.59. 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. MKKGY's PEG compares to its industry's average PEG of 2.08. Over the past 52 weeks, MKKGY's PEG has been as high as 2.31 and as low as 1.40, with a median of 2.07.Another valuation metric that we should highlight is MKKGY's P/B ratio of 0.55. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.22. Within the past 52 weeks, MKKGY's P/B has been as high as 0.84 and as low as 0.49, with a median of 0.68.Finally, investors should note that MKKGY has a P/CF ratio of 6.81. 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. MKKGY's P/CF compares to its industry's average P/CF of 9.50. Over the past year, MKKGY's P/CF has been as high as 17.18 and as low as 5.99, with a median of 8.37.These are only a few of the key metrics included in Merck KGaA'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, MKKGY looks like an impressive value stock at the moment.Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant 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 Merck KGaA (MKKGY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks