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Is Mitsubishi UFJ Financial Group Inc (MUFG) Stock Trading Below Fair Value?

Monday, April 01, 2024 10:09 AM | InvestorsObserver Analysts

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Is Mitsubishi UFJ Financial Group Inc (MUFG) Stock Trading Below Fair Value?

InvestorsObserver gives Mitsubishi UFJ Financial Group Inc (MUFG) a strong valuation score of 100 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. MUFG currently holds a better value than 100% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.

Valuation Rank - 100
MUFG gets a 100 Valuation Rank today. Find out what this means to you and get the rest of the rankings on MUFG!

Metrics Analysis

MUFG has a trailing twelve month Price to Earnings (PE) ratio of 0.21. The historical average of roughly 15 shows a good value for MUFG stock as investors are paying lower share prices relative to the company's earnings. MUFG's low trailing PE ratio shows that the firm has been trading below its fair market value recently. Its trailing 12-month earnings per share (EPS) of 48.39 more than justifies the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
MUFG's 12-month-forward PE to Growth (PEG) ratio of 1 is considered a roughly average value as the market is valuing MUFG right in line with its projected earnings growth. MUFG'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 adequate picture for MUFG at its current price due to a fairly valued PEG ratio due to strong growth. The PE and PEG for MUFG are around the average of the market resulting in a valuation score of 100. Click Here to get the full Report on Mitsubishi UFJ Financial Group Inc (MUFG) stock.

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