Is Radian (RDN) a Great Value Stock Right Now?

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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.

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.

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 to watch right now is Radian (RDN). RDN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 7.42. This compares to its industry’s average Forward P/E of 7.75. Over the past year, RDN’s Forward P/E has been as high as 8.32 and as low as 3.29, with a median of 7.01.

Investors should also recognize that RDN has a P/B ratio of 0.85. Investors use the P/B ratio to look at a stock’s market value versus its book value, which is defined as total assets minus total liabilities. This stock’s P/B looks attractive against its industry’s average P/B of 1.02. Over the past year, RDN’s P/B has been as high as 1.36 and as low as 0.49, with a median of 0.81.

Value investors will likely look at more than just these metrics, but the above data helps show that Radian is likely undervalued currently. And when considering the strength of its earnings outlook, RDN sticks out at as one of the market’s strongest value stocks.

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