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Should Value Investors Buy These Oils-Energy Stocks?
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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.
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.
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 company to watch right now is Ecopetrol (EC - Free Report) . EC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is EC's P/B ratio of 1.05. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. EC's current P/B looks attractive when compared to its industry's average P/B of 1.27. EC's P/B has been as high as 1.75 and as low as 0.35, with a median of 1.15, over the past year.
Finally, investors should note that EC has a P/CF ratio of 1.76. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. EC's P/CF compares to its industry's average P/CF of 4.19. Over the past 52 weeks, EC's P/CF has been as high as 2.06 and as low as 1.57, with a median of 1.77.
Investors could also keep in mind Petroleo Brasileiro (PBR - Free Report) , an Oil and Gas - Integrated - Emerging Markets stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Petroleo Brasileiro is trading at a forward earnings multiple of 4.62 at the moment, with a PEG ratio of 0.19. This compares to its industry's average P/E of 3.31 and average PEG ratio of 0.11.
PBR's price-to-earnings ratio has been as high as 15.68 and as low as 3.27, with a median of 4.75, while its PEG ratio has been as high as 0.34 and as low as 0.14, with a median of 0.19, all within the past year.
Petroleo Brasileiro sports a P/B ratio of 1.26 as well; this compares to its industry's price-to-book ratio of 1.27. In the past 52 weeks, PBR's P/B has been as high as 1.41, as low as 0.79, with a median of 1.
Value investors will likely look at more than just these metrics, but the above data helps show that Ecopetrol and Petroleo Brasileiro are likely undervalued currently. And when considering the strength of its earnings outlook, EC and PBR sticks out as one of the market's strongest value stocks.
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Should Value Investors Buy These Oils-Energy Stocks?
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.
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.
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 company to watch right now is Ecopetrol (EC - Free Report) . EC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is EC's P/B ratio of 1.05. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. EC's current P/B looks attractive when compared to its industry's average P/B of 1.27. EC's P/B has been as high as 1.75 and as low as 0.35, with a median of 1.15, over the past year.
Finally, investors should note that EC has a P/CF ratio of 1.76. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. EC's P/CF compares to its industry's average P/CF of 4.19. Over the past 52 weeks, EC's P/CF has been as high as 2.06 and as low as 1.57, with a median of 1.77.
Investors could also keep in mind Petroleo Brasileiro (PBR - Free Report) , an Oil and Gas - Integrated - Emerging Markets stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Petroleo Brasileiro is trading at a forward earnings multiple of 4.62 at the moment, with a PEG ratio of 0.19. This compares to its industry's average P/E of 3.31 and average PEG ratio of 0.11.
PBR's price-to-earnings ratio has been as high as 15.68 and as low as 3.27, with a median of 4.75, while its PEG ratio has been as high as 0.34 and as low as 0.14, with a median of 0.19, all within the past year.
Petroleo Brasileiro sports a P/B ratio of 1.26 as well; this compares to its industry's price-to-book ratio of 1.27. In the past 52 weeks, PBR's P/B has been as high as 1.41, as low as 0.79, with a median of 1.
Value investors will likely look at more than just these metrics, but the above data helps show that Ecopetrol and Petroleo Brasileiro are likely undervalued currently. And when considering the strength of its earnings outlook, EC and PBR sticks out as one of the market's strongest value stocks.