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Pilgrim's Pride: Is it a Good Pick for Value Investors?
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Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put Pilgrim's Pride Corporation (PPC - Free Report) stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, Pilgrim's Pride has a trailing twelve months PE ratio of 12.11, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 20.49. While Pilgrim's Pride’s current PE level puts it above its midpoint of 10.73 over the past five years, it stands way below the highs for the stock. This indicates that it could be a solid entry point for value investors.
Further, the stock’s PE also compares favorably with the Zacks classified Consumer Discretionary sector’s trailing twelve months PE ratio, which stands at 24.58. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that Pilgrim's Pride has a forward PE ratio (price relative to this year’s earnings) of just 10.19, so it is fair to say that a slightly more value-oriented path may be ahead for Pilgrim's Pride stock in the near term too.
P/S Ratio
Another key metric to note is the Price/Sales ratio. This approach compares a given stock’s price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.
Right now, Pilgrim's Pride has a P/S ratio of about 0.66. This is significantly lower than the S&P 500 average, which comes in at 3.11 right now. Also, as we can see in the chart below, this is well below the highs for this stock in particular over the past few years.
Broad Value Outlook
In aggregate, Pilgrim's Pride currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes Pilgrim's Pride a solid choice for value investors.
What About the Stock Overall?
While Pilgrim's Pride might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘C’ and a Momentum score of ‘F’. This gives PPC a Zacks VGM score—or its overarching fundamental grade—of ‘B’. (You can read more about the Zacks Style Scores here >>)
Notably, the company’s recent earnings estimates have been quite encouraging. Though the current quarter has not seen any estimate revisions in the last sixty days, the full year estimate has seen two upward and no downward revisions in the same time period.
This has had a positive impact on the consensus estimate, as the current quarter consensus estimate has jumped 10% in the past two months, while the full year estimate has risen by 2.5%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
This bullish trend is why the stock boasts a Zacks Rank #2 (Buy) and why we are looking for outperformance from the company in the near term.
Bottom Line
Clearly, Pilgrim's Pride is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Flaunting a Zacks Rank #2, the company also has a solid industry rank (Top 21% out of over 250 industries). Moreover, over the past two years, the Zacks classified Food – Meat Products industry has clearly outperformed the broader market, as you can see below:
So, it might pay for value investors to delve deeper into the company’s prospects, as fundamentals indicate that this stock could be a compelling pick.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>
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Pilgrim's Pride: Is it a Good Pick for Value Investors?
Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
![](https://staticx-tuner.zacks.com/images/zadmin_tuner_image/ppc_20170306%20(1).jpg)
![](https://staticx-tuner.zacks.com/images/zadmin_tuner_image/ppc_20170306%20(2).jpg)
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put Pilgrim's Pride Corporation (PPC - Free Report) stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, Pilgrim's Pride has a trailing twelve months PE ratio of 12.11, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 20.49. While Pilgrim's Pride’s current PE level puts it above its midpoint of 10.73 over the past five years, it stands way below the highs for the stock. This indicates that it could be a solid entry point for value investors.
Further, the stock’s PE also compares favorably with the Zacks classified Consumer Discretionary sector’s trailing twelve months PE ratio, which stands at 24.58. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that Pilgrim's Pride has a forward PE ratio (price relative to this year’s earnings) of just 10.19, so it is fair to say that a slightly more value-oriented path may be ahead for Pilgrim's Pride stock in the near term too.
P/S Ratio
Another key metric to note is the Price/Sales ratio. This approach compares a given stock’s price to its total sales, where a lower reading is generally considered better. Some people like this metric more than other value-focused ones because it looks at sales, something that is far harder to manipulate with accounting tricks than earnings.
Right now, Pilgrim's Pride has a P/S ratio of about 0.66. This is significantly lower than the S&P 500 average, which comes in at 3.11 right now. Also, as we can see in the chart below, this is well below the highs for this stock in particular over the past few years.
Broad Value Outlook
In aggregate, Pilgrim's Pride currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes Pilgrim's Pride a solid choice for value investors.
What About the Stock Overall?
While Pilgrim's Pride might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘C’ and a Momentum score of ‘F’. This gives PPC a Zacks VGM score—or its overarching fundamental grade—of ‘B’. (You can read more about the Zacks Style Scores here >>)
Notably, the company’s recent earnings estimates have been quite encouraging. Though the current quarter has not seen any estimate revisions in the last sixty days, the full year estimate has seen two upward and no downward revisions in the same time period.
This has had a positive impact on the consensus estimate, as the current quarter consensus estimate has jumped 10% in the past two months, while the full year estimate has risen by 2.5%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
Pilgrim's Pride Corporation Price and Consensus
Pilgrim's Pride Corporation Price and Consensus | Pilgrim's Pride Corporation Quote
This bullish trend is why the stock boasts a Zacks Rank #2 (Buy) and why we are looking for outperformance from the company in the near term.
![](https://staticx-tuner.zacks.com/images/zadmin_tuner_image/ppc_20170306%20(5).jpg)
Bottom Line
Clearly, Pilgrim's Pride is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Flaunting a Zacks Rank #2, the company also has a solid industry rank (Top 21% out of over 250 industries). Moreover, over the past two years, the Zacks classified Food – Meat Products industry has clearly outperformed the broader market, as you can see below:
So, it might pay for value investors to delve deeper into the company’s prospects, as fundamentals indicate that this stock could be a compelling pick.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? Last year's market-beating Top 10 portfolio produced 5 double-digit winners. For example, oil and natural gas giant Pioneer Natural Resources and First Republic Bank racked up stellar gains of +44.9% and +44.3% respectively. Now a brand-new list for 2017 has been hand-picked from 4,400 companies covered by the Zacks Rank. See the 2017 Top 10 right now>>