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Are Investors Undervaluing Phibro Animal Health (PAHC) 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, 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.

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 value investors might notice is Phibro Animal Health (PAHC - Free Report) . PAHC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 13.10 right now. For comparison, its industry sports an average P/E of 21.65. Over the last 12 months, PAHC's Forward P/E has been as high as 15.18 and as low as 8.01, with a median of 10.64.

We also note that PAHC holds a PEG ratio of 1.51. 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. PAHC's industry has an average PEG of 2.14 right now. PAHC's PEG has been as high as 6.96 and as low as 1.51, with a median of 4.37, all within the past year.

Another valuation metric that we should highlight is PAHC's P/B ratio of 3.06. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 5.22. PAHC's P/B has been as high as 3.39 and as low as 1.42, with a median of 1.89, over the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. PAHC has a P/S ratio of 0.77. This compares to its industry's average P/S of 1.45.

Finally, we should also recognize that PAHC has a P/CF ratio of 19.88. 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. PAHC's P/CF compares to its industry's average P/CF of 37.01. Over the past 52 weeks, PAHC's P/CF has been as high as 21.97 and as low as 6.94, with a median of 10.11.

If you're looking for another solid Medical - Products value stock, take a look at Koninklijke Philips (PHG - Free Report) . PHG is a # 2 (Buy) stock with a Value score of A.

Shares of Koninklijke Philips currently holds a Forward P/E ratio of 17.57, and its PEG ratio is 0.91. In comparison, its industry sports average P/E and PEG ratios of 21.65 and 2.14.

Over the last 12 months, PHG's P/E has been as high as 18.13, as low as 12.29, with a median of 14.35, and its PEG ratio has been as high as 1.33, as low as 0.78, with a median of 0.91.

Koninklijke Philips also has a P/B ratio of 2.18 compared to its industry's price-to-book ratio of 5.22. Over the past year, its P/B ratio has been as high as 2.25, as low as 1.28, with a median of 1.50.

Value investors will likely look at more than just these metrics, but the above data helps show that Phibro Animal Health and Koninklijke Philips are likely undervalued currently. And when considering the strength of its earnings outlook, PAHC and PHG sticks out as one of the market's strongest value stocks.


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