Are These Consumer Discretionary Stocks Undervalued 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 company value investors might notice is Nexstar Media Group (NXST). NXST is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 8.60, which compares to its industry's average of 24.57. Over the last 12 months, NXST's Forward P/E has been as high as 10.17 and as low as 5.60, with a median of 7.62.

Investors should also note that NXST holds a PEG ratio of 0.86. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NXST's PEG compares to its industry's average PEG of 1.83. Over the last 12 months, NXST's PEG has been as high as 1.02 and as low as 0.56, with a median of 0.76.

Investors could also keep in mind TEGNA (TGNA), an Broadcast Radio and Television stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Shares of TEGNA currently holds a Forward P/E ratio of 8.74, and its PEG ratio is 0.87. In comparison, its industry sports average P/E and PEG ratios of 24.57 and 1.83.

Over the past year, TGNA's P/E has been as high as 10.31, as low as 6.19, with a median of 7.75; its PEG ratio has been as high as 1.03, as low as 0.62, with a median of 0.76 during the same time period.

Additionally, TEGNA has a P/B ratio of 1.74 while its industry's price-to-book ratio sits at 17.35. For TGNA, this valuation metric has been as high as 2.21, as low as 1.49, with a median of 1.86 over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Nexstar Media Group and TEGNA are likely undervalued currently. And when considering the strength of its earnings outlook, NXST and TGNA sticks out as one of the market's strongest value stocks.

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Nexstar Media Group, Inc (NXST) : Free Stock Analysis Report
 
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