Are Investors Undervaluing Geopark (GPRK) Right Now?

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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 value investors might notice is Geopark (GPRK). GPRK is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.32, while its industry has an average P/E of 15.19. Over the past year, GPRK's Forward P/E has been as high as 12.16 and as low as 2.03, with a median of 3.14.

We should also highlight that GPRK has a P/B ratio of 1.5. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. GPRK's current P/B looks attractive when compared to its industry's average P/B of 2.97. Within the past 52 weeks, GPRK's P/B has been as high as 2.96 and as low as 1.42, with a median of 1.97.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GPRK has a P/S ratio of 0.83. This compares to its industry's average P/S of 2.22.

These are only a few of the key metrics included in Geopark's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, GPRK looks like an impressive value stock at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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