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Are Investors Undervaluing Compania Cervecerias Unidas (CCU) Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

Compania Cervecerias Unidas (CCU - Free Report) is a stock many investors are watching right now. CCU is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 13.09, while its industry has an average P/E of 23.54. Over the past 52 weeks, CCU's Forward P/E has been as high as 18.38 and as low as 10.22, with a median of 12.97.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CCU has a P/S ratio of 0.61. This compares to its industry's average P/S of 1.82.

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


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