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Is Greenbrier Companies (GBX) a Great Value Stock Right Now?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 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.

Greenbrier Companies (GBX - Free Report) is a stock many investors are watching right now. GBX 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 9.36 right now. For comparison, its industry sports an average P/E of 10.79. Over the last 12 months, GBX's Forward P/E has been as high as 15.76 and as low as 8.57, with a median of 12.48.

Investors will also notice that GBX has a PEG ratio of 0.99. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. GBX's industry has an average PEG of 1.06 right now. Within the past year, GBX's PEG has been as high as 1.66 and as low as 0.90, with a median of 1.31.

Another valuation metric that we should highlight is GBX's P/B ratio of 0.96. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.23. Within the past 52 weeks, GBX's P/B has been as high as 1.50 and as low as 0.88, with a median of 1.18.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. GBX has a P/S ratio of 0.54. This compares to its industry's average P/S of 1.21.

Value investors will likely look at more than just these metrics, but the above data helps show that Greenbrier Companies is likely undervalued currently. And when considering the strength of its earnings outlook, GBX sticks out at as one of the market's strongest value stocks.


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