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Are Investors Undervaluing LATAM (LTM) Right Now?

By Zacks Investment ResearchStock MarketsMar 04, 2020 11:50PM ET
www.investing.com/analysis/are-investors-undervaluing-latam-ltm-right-now-200513748
Are Investors Undervaluing LATAM (LTM) Right Now?
By Zacks Investment Research   |  Mar 04, 2020 11:50PM ET
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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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 LATAM (LTM). LTM is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

We also note that LTM holds a PEG ratio of 0.42. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. LTM's PEG compares to its industry's average PEG of 0.70. Within the past year, LTM's PEG has been as high as 0.48 and as low as 0.34, with a median of 0.43.

Another valuation metric that we should highlight is LTM's P/B ratio of 1.42. The P/B ratio is used to compare a stock's market value with 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 2.63. Over the past year, LTM's P/B has been as high as 2.56 and as low as 1.42, with a median of 1.89.

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. LTM has a P/S ratio of 0.42. This compares to its industry's average P/S of 0.48.

These are just a handful of the figures considered in LATAM's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that LTM is an impressive value stock right now.



LATAM Airlines Group S.A. (LTM): Free Stock Analysis Report

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Are Investors Undervaluing LATAM (LTM) Right Now?
 

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Are Investors Undervaluing LATAM (LTM) Right Now?

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