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Is PriceSmart (PSMT) Stock Undervalued Right Now?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is PriceSmart (PSMT - Free Report) . PSMT 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 15.90 right now. For comparison, its industry sports an average P/E of 30.63. Over the past 52 weeks, PSMT's Forward P/E has been as high as 17.56 and as low as 15.25, with a median of 16.41.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PSMT has a P/S ratio of 0.54. This compares to its industry's average P/S of 0.76.

Finally, we should also recognize that PSMT has a P/CF ratio of 12.25. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. PSMT's P/CF compares to its industry's average P/CF of 30.13. Over the past 52 weeks, PSMT's P/CF has been as high as 13.49 and as low as 10.59, with a median of 12.41.

These are only a few of the key metrics included in PriceSmart's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, PSMT looks like an impressive value stock at the moment.


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