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Should Value Investors Buy Koppers (KOP) Stock?

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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.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Koppers (KOP - Free Report) . KOP is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 6.07. This compares to its industry's average Forward P/E of 17.52. Over the past year, KOP's Forward P/E has been as high as 11.01 and as low as 2.58, with a median of 7.43.

Finally, investors will want to recognize that KOP has a P/CF ratio of 3.74. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. KOP's P/CF compares to its industry's average P/CF of 11.73. Within the past 12 months, KOP's P/CF has been as high as 9.40 and as low as 1.64, with a median of 4.36.

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


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