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Should Value Investors Buy These Consumer Staples 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is Ingredion (INGR - Free Report) . INGR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 11.74, which compares to its industry's average of 18.86. Over the past year, INGR's Forward P/E has been as high as 14.47 and as low as 11.55, with a median of 13.53.
Investors should also recognize that INGR has a P/B ratio of 1.85. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. INGR's current P/B looks attractive when compared to its industry's average P/B of 2.24. Over the past 12 months, INGR's P/B has been as high as 2.46 and as low as 1.82, with a median of 2.08.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. INGR has a P/S ratio of 0.85. This compares to its industry's average P/S of 1.51.
Finally, our model also underscores that INGR has a P/CF ratio of 17.38. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. INGR's current P/CF looks attractive when compared to its industry's average P/CF of 19.07. Over the past year, INGR's P/CF has been as high as 27.60 and as low as 10.40, with a median of 17.42.
Investors could also keep in mind Premier Foods (PRRFY - Free Report) , an Food - Miscellaneous stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Premier Foods sports a P/B ratio of 0.81 as well; this compares to its industry's price-to-book ratio of 2.24. In the past 52 weeks, PRRFY's P/B has been as high as 0.91, as low as 0.70, with a median of 0.78.
Value investors will likely look at more than just these metrics, but the above data helps show that Ingredion and Premier Foods are likely undervalued currently. And when considering the strength of its earnings outlook, INGR and PRRFY sticks out as one of the market's strongest value stocks.
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Should Value Investors Buy These Consumer Staples 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is Ingredion (INGR - Free Report) . INGR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 11.74, which compares to its industry's average of 18.86. Over the past year, INGR's Forward P/E has been as high as 14.47 and as low as 11.55, with a median of 13.53.
Investors should also recognize that INGR has a P/B ratio of 1.85. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. INGR's current P/B looks attractive when compared to its industry's average P/B of 2.24. Over the past 12 months, INGR's P/B has been as high as 2.46 and as low as 1.82, with a median of 2.08.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. INGR has a P/S ratio of 0.85. This compares to its industry's average P/S of 1.51.
Finally, our model also underscores that INGR has a P/CF ratio of 17.38. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. INGR's current P/CF looks attractive when compared to its industry's average P/CF of 19.07. Over the past year, INGR's P/CF has been as high as 27.60 and as low as 10.40, with a median of 17.42.
Investors could also keep in mind Premier Foods (PRRFY - Free Report) , an Food - Miscellaneous stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Premier Foods sports a P/B ratio of 0.81 as well; this compares to its industry's price-to-book ratio of 2.24. In the past 52 weeks, PRRFY's P/B has been as high as 0.91, as low as 0.70, with a median of 0.78.
Value investors will likely look at more than just these metrics, but the above data helps show that Ingredion and Premier Foods are likely undervalued currently. And when considering the strength of its earnings outlook, INGR and PRRFY sticks out as one of the market's strongest value stocks.