Back to top

Image: Bigstock

Should Value Investors Buy Chemours (CC) Stock?

Read MoreHide Full Article

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Chemours (CC - Free Report) . CC 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 7.20. This compares to its industry's average Forward P/E of 12.22. Over the last 12 months, CC's Forward P/E has been as high as 12.18 and as low as 6.71, with a median of 9.56.

Investors should also note that CC holds a PEG ratio of 0.21. 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. CC's PEG compares to its industry's average PEG of 0.58. CC's PEG has been as high as 0.45 and as low as 0.19, with a median of 0.28, all within the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CC has a P/S ratio of 0.85. This compares to its industry's average P/S of 0.89.

Finally, investors will want to recognize that CC has a P/CF ratio of 7.33. 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. CC's current P/CF looks attractive when compared to its industry's average P/CF of 11.07. Over the past 52 weeks, CC's P/CF has been as high as 22.03 and as low as 6.51, with a median of 8.82.

These are only a few of the key metrics included in Chemours's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, CC looks like an impressive value stock at the moment.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


The Chemours Company (CC) - free report >>

Published in