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Are Investors Undervaluing Sibanye Gold Limited (SBSW) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company value investors might notice is Sibanye Gold Limited (SBSW - Free Report) . SBSW is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 3.50 right now. For comparison, its industry sports an average P/E of 9.37. SBSW's Forward P/E has been as high as 88.91 and as low as 1.25, with a median of 5.50, all within the past year.

Another notable valuation metric for SBSW is its P/B ratio of 2.69. Investors use the P/B ratio to look at a stock's market value versus 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 4.12. Within the past 52 weeks, SBSW's P/B has been as high as 3.98 and as low as 1.10, with a median of 2.24.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Sibanye Gold Limited is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SBSW feels like a great value stock at the moment.


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