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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, 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 Terex (TEX - Free Report) . TEX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 8.74 right now. For comparison, its industry sports an average P/E of 13.58. TEX's Forward P/E has been as high as 12.24 and as low as 6.36, with a median of 8.45, all within the past year.
Investors will also notice that TEX has a PEG ratio of 0.46. 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. TEX's industry has an average PEG of 1.08 right now. Over the past 52 weeks, TEX's PEG has been as high as 0.65 and as low as 0.36, with a median of 0.48.
Another notable valuation metric for TEX is its P/B ratio of 2.48. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. TEX's current P/B looks attractive when compared to its industry's average P/B of 5.81. TEX's P/B has been as high as 3.45 and as low as 1.73, with a median of 2.32, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. TEX has a P/S ratio of 0.69. This compares to its industry's average P/S of 0.84.
Finally, our model also underscores that TEX has a P/CF ratio of 6.93. 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. TEX's current P/CF looks attractive when compared to its industry's average P/CF of 9.50. Within the past 12 months, TEX's P/CF has been as high as 9.65 and as low as 5.62, with a median of 7.47.
Value investors will likely look at more than just these metrics, but the above data helps show that Terex is likely undervalued currently. And when considering the strength of its earnings outlook, TEX sticks out at as one of the market's strongest value stocks.
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Are Investors Undervaluing Terex (TEX) Right Now?
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, 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 Terex (TEX - Free Report) . TEX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 8.74 right now. For comparison, its industry sports an average P/E of 13.58. TEX's Forward P/E has been as high as 12.24 and as low as 6.36, with a median of 8.45, all within the past year.
Investors will also notice that TEX has a PEG ratio of 0.46. 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. TEX's industry has an average PEG of 1.08 right now. Over the past 52 weeks, TEX's PEG has been as high as 0.65 and as low as 0.36, with a median of 0.48.
Another notable valuation metric for TEX is its P/B ratio of 2.48. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. TEX's current P/B looks attractive when compared to its industry's average P/B of 5.81. TEX's P/B has been as high as 3.45 and as low as 1.73, with a median of 2.32, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. TEX has a P/S ratio of 0.69. This compares to its industry's average P/S of 0.84.
Finally, our model also underscores that TEX has a P/CF ratio of 6.93. 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. TEX's current P/CF looks attractive when compared to its industry's average P/CF of 9.50. Within the past 12 months, TEX's P/CF has been as high as 9.65 and as low as 5.62, with a median of 7.47.
Value investors will likely look at more than just these metrics, but the above data helps show that Terex is likely undervalued currently. And when considering the strength of its earnings outlook, TEX sticks out at as one of the market's strongest value stocks.