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Should Value Investors Buy Global Payments (GPN) Stock?
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Global Payments (GPN - Free Report) is a stock many investors are watching right now. GPN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 7.94, which compares to its industry's average of 21.96. Over the last 12 months, GPN's Forward P/E has been as high as 12.20 and as low as 7.93, with a median of 10.28.
GPN is also sporting a PEG ratio of 0.56. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GPN's PEG compares to its industry's average PEG of 1.34. GPN's PEG has been as high as 0.83 and as low as 0.55, with a median of 0.71, all within the past year.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GPN has a P/S ratio of 2.55. This compares to its industry's average P/S of 2.67.
Finally, investors should note that GPN has a P/CF ratio of 7.71. 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. GPN's P/CF compares to its industry's average P/CF of 17.67. Over the past year, GPN's P/CF has been as high as 16.66 and as low as 7.69, with a median of 11.63.
Western Union (WU - Free Report) may be another strong Financial Transaction Services stock to add to your shortlist. WU is a # 1 (Strong Buy) stock with a Value grade of A.
Shares of Western Union currently holds a Forward P/E ratio of 7.18, and its PEG ratio is 1.83. In comparison, its industry sports average P/E and PEG ratios of 21.96 and 1.34.
WU's price-to-earnings ratio has been as high as 8.31 and as low as 6.47, with a median of 7.33, while its PEG ratio has been as high as 5.13 and as low as 1.80, with a median of 4.21, all within the past year.
Additionally, Western Union has a P/B ratio of 10.99 while its industry's price-to-book ratio sits at 7.19. For WU, this valuation metric has been as high as 11.69, as low as 6.51, with a median of 7.86 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Global Payments and Western Union are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GPN and WU feels like a great value stock at the moment.
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Should Value Investors Buy Global Payments (GPN) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Global Payments (GPN - Free Report) is a stock many investors are watching right now. GPN is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 7.94, which compares to its industry's average of 21.96. Over the last 12 months, GPN's Forward P/E has been as high as 12.20 and as low as 7.93, with a median of 10.28.
GPN is also sporting a PEG ratio of 0.56. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GPN's PEG compares to its industry's average PEG of 1.34. GPN's PEG has been as high as 0.83 and as low as 0.55, with a median of 0.71, all within the past year.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GPN has a P/S ratio of 2.55. This compares to its industry's average P/S of 2.67.
Finally, investors should note that GPN has a P/CF ratio of 7.71. 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. GPN's P/CF compares to its industry's average P/CF of 17.67. Over the past year, GPN's P/CF has been as high as 16.66 and as low as 7.69, with a median of 11.63.
Western Union (WU - Free Report) may be another strong Financial Transaction Services stock to add to your shortlist. WU is a # 1 (Strong Buy) stock with a Value grade of A.
Shares of Western Union currently holds a Forward P/E ratio of 7.18, and its PEG ratio is 1.83. In comparison, its industry sports average P/E and PEG ratios of 21.96 and 1.34.
WU's price-to-earnings ratio has been as high as 8.31 and as low as 6.47, with a median of 7.33, while its PEG ratio has been as high as 5.13 and as low as 1.80, with a median of 4.21, all within the past year.
Additionally, Western Union has a P/B ratio of 10.99 while its industry's price-to-book ratio sits at 7.19. For WU, this valuation metric has been as high as 11.69, as low as 6.51, with a median of 7.86 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Global Payments and Western Union are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GPN and WU feels like a great value stock at the moment.