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Is Adecoagro (AGRO) Stock Undervalued 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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Adecoagro (AGRO - Free Report) is a stock many investors are watching right now. AGRO is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 7.91, while its industry has an average P/E of 11.19. AGRO's Forward P/E has been as high as 12.97 and as low as 6.69, with a median of 10.25, all within the past year.

Finally, we should also recognize that AGRO has a P/CF ratio of 2.86. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 7.12. Within the past 12 months, AGRO's P/CF has been as high as 3.47 and as low as 2, with a median of 2.70.

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


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