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Is G4S PLC (GFSZY) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

G4S PLC (GFSZY - Free Report) is a stock many investors are watching right now. GFSZY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 10.28, which compares to its industry's average of 17.76. GFSZY's Forward P/E has been as high as 12.69 and as low as 4.51, with a median of 10.24, all within the past year.

We also note that GFSZY holds a PEG ratio of 1.76. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GFSZY's PEG compares to its industry's average PEG of 2.84. Over the last 12 months, GFSZY's PEG has been as high as 2.11 and as low as 1.51, with a median of 1.78.

Value investors will likely look at more than just these metrics, but the above data helps show that G4S PLC is likely undervalued currently. And when considering the strength of its earnings outlook, GFSZY sticks out at as one of the market's strongest value stocks.


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