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Should Value Investors Buy Invesco (IVZ) Stock?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

Invesco (IVZ - Free Report) is a stock many investors are watching right now. IVZ is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 9.62, which compares to its industry's average of 17.02. Over the past year, IVZ's Forward P/E has been as high as 12.55 and as low as 7.36, with a median of 9.17.

We also note that IVZ holds a PEG ratio of 0.93. 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. IVZ's PEG compares to its industry's average PEG of 0.95. Over the past 52 weeks, IVZ's PEG has been as high as 2.92 and as low as 0.91, with a median of 1.13.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. IVZ has a P/S ratio of 1.37. This compares to its industry's average P/S of 3.04.

These are only a few of the key metrics included in Invesco'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, IVZ looks like an impressive value stock at the moment.


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