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Are Investors Undervaluing Jabil (JBL) Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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.

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.

One company value investors might notice is Jabil (JBL - Free Report) . JBL is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 9.08. This compares to its industry's average Forward P/E of 11.44. Over the past year, JBL's Forward P/E has been as high as 13.65 and as low as 5.04, with a median of 9.48.

JBL is also sporting a PEG ratio of 0.76. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. JBL's industry has an average PEG of 0.91 right now. JBL's PEG has been as high as 1.14 and as low as 0.42, with a median of 0.79, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. JBL has a P/S ratio of 0.2. This compares to its industry's average P/S of 0.3.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Jabil is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, JBL feels like a great value stock at the moment.


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