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Evolution Petroleum Corporation, Inc. (EPM) - free report >>
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Evolution Petroleum Corporation, Inc. (EPM) - free report >>
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Is Evolution Petroleum (EPM) Stock Undervalued Right Now?
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 Evolution Petroleum (EPM - Free Report) . EPM is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 7.79. This compares to its industry's average Forward P/E of 9.17. Over the last 12 months, EPM's Forward P/E has been as high as 9.19 and as low as 4.75, with a median of 6.80.
Finally, our model also underscores that EPM has a P/CF ratio of 4.36. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 4.71. Within the past 12 months, EPM's P/CF has been as high as 7.01 and as low as 3.23, with a median of 4.32.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Evolution Petroleum is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, EPM feels like a great value stock at the moment.