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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
Suzano (SUZ) is a stock many investors are watching right now. SUZ is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 7.36 right now. For comparison, its industry sports an average P/E of 12.59. SUZ's Forward P/E has been as high as 8.72 and as low as -53.51, with a median of 6.01, all within the past year.
Investors should also note that SUZ holds a PEG ratio of 0.14. 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. SUZ's industry currently sports an average PEG of 0.29. Over the last 12 months, SUZ's PEG has been as high as 0.14 and as low as 0.01, with a median of 0.12.
Finally, we should also recognize that SUZ has a P/CF ratio of 3.75. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 7. Over the past 52 weeks, SUZ's P/CF has been as high as 39.34 and as low as 3.52, with a median of 7.53.
These are just a handful of the figures considered in Suzano's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that SUZ is an impressive value stock right now.
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This article originally published on Zacks Investment Research (zacks.com).