Are Investors Undervaluing First American Financial (FAF) 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 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.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.One company to watch right now is First American Financial (FAF). FAF is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 11.29, while its industry has an average P/E of 26.63. FAF's Forward P/E has been as high as 15.32 and as low as 11.29, with a median of 12.45, all within the past year.We should also highlight that FAF has a P/B ratio of 1.21. 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 stock's P/B looks solid versus its industry's average P/B of 1.49. Over the past year, FAF's P/B has been as high as 1.43 and as low as 1.12, with a median of 1.27.Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. FAF has a P/S ratio of 1.01. This compares to its industry's average P/S of 1.19.MS&AD Insurance Group (MSADY) may be another strong Insurance - Property and Casualty stock to add to your shortlist. MSADY is a # 2 (Buy) stock with a Value grade of A.MS&AD Insurance Group also has a P/B ratio of 1.15 compared to its industry's price-to-book ratio of 1.49. Over the past year, its P/B ratio has been as high as 1.35, as low as 0.78, with a median of 1.15.These figures are just a handful of the metrics value investors tend to look at, but they help show that First American Financial and MS&AD Insurance Group are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FAF and MSADY feels like a great value stock at the moment.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +24.1% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 First American Financial Corporation (FAF): Free Stock Analysis Report MS&AD Insurance Group Holdings Inc. (MSADY): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks