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Should Value Investors Buy Pitney Bowes (PBI) 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.

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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company to watch right now is Pitney Bowes (PBI - Free Report) . PBI is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.43, while its industry has an average P/E of 8.52. Over the past 52 weeks, PBI's Forward P/E has been as high as 440 and as low as 8.19, with a median of 21.14.

We also note that PBI holds a PEG ratio of 0.56. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. PBI's PEG compares to its industry's average PEG of 0.57. Within the past year, PBI's PEG has been as high as 29.33 and as low as 0.55, with a median of 1.41.

Finally, investors should note that PBI has a P/CF ratio of 9.07. 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. PBI's current P/CF looks attractive when compared to its industry's average P/CF of 9.25. Over the past 52 weeks, PBI's P/CF has been as high as 10.20 and as low as 3.40, with a median of 5.83.

These are just a handful of the figures considered in Pitney Bowes's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that PBI is an impressive value stock right now.


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