Are Investors Undervaluing United Rentals (URI) 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, 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 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 company value investors might notice is United Rentals (URI). URI is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 11.23. This compares to its industry's average Forward P/E of 18.62. URI's Forward P/E has been as high as 12.88 and as low as 3.38, with a median of 7.49, all within the past year.

We also note that URI holds a PEG ratio of 0.94. 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. URI's industry currently sports an average PEG of 1.62. Over the last 12 months, URI's PEG has been as high as 1.07 and as low as 0.27, with a median of 0.61.

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

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