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Is Autohome Inc (ATHM) Stock Over or Undervalued?

Friday, December 03, 2021 12:43 PM | InvestorsObserver Analysts

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Is Autohome Inc (ATHM) Stock Over or Undervalued?

Autohome Inc (ATHM) receives a strong valuation ranking of 70 from InvestorsObserver data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. ATHM has a better value than 70% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.

Valuation Rank - 70
ATHM gets a 70 Valuation Rank today. Find out what this means to you and get the rest of the rankings on ATHM!

Metrics Analysis

ATHM has a trailing twelve month Price to Earnings (PE) ratio of 6.2 which places it below the histroical average of roughly 15. ATHM is currently trading at a good value due to investors paying less than what the stock is worth in relation to its earnings. ATHM's trailing-12-month earnings per share (EPS) of 5.51 does justify its share price in the market. Trailing PE ratios do not factor in the company's projected growth rate, thus, some firms will have high PE ratios caused by high growth recruiting more investors even if the underlying company has produced low earnings so far. ATHM's 12-month-forward PE to Growth (PEG) ratio of 0.63 is considered a good value as the market is undervaluing ATHM in relation to the company's projected earnings growth. ATHM's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.

Summary

All together these valuation metrics paint a pretty strong picture for ATHM at its current price due to a undervalued PEG ratio due to strong growth. The PE and PEG for ATHM are better than the average of the market resulting in a valuation score of 70. Click Here to get the full Report on Autohome Inc (ATHM) stock.

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