Back to top

Image: Bigstock

Should Value Investors Buy Frontline (FRO) Stock?

Read MoreHide Full Article

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 Frontline (FRO - Free Report) . FRO is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value.

Investors should also note that FRO holds a PEG ratio of 1.52. 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. FRO's industry currently sports an average PEG of 2.63. Over the past 52 weeks, FRO's PEG has been as high as 2.13 and as low as 1.17, with a median of 1.68.

Finally, investors should note that FRO has a P/CF ratio of 4.06. 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. FRO's current P/CF looks attractive when compared to its industry's average P/CF of 7.95. Within the past 12 months, FRO's P/CF has been as high as 12.71 and as low as 3.97, with a median of 7.34.

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Frontline PLC (FRO) - free report >>

Published in