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.
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.
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.
Cemex (CX) is a stock many investors are watching right now. CX is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock holds a P/E ratio of 12.45, while its industry has an average P/E of 24.08. CX's Forward P/E has been as high as 13.11 and as low as 6.51, with a median of 8.44, all within the past year.
We also note that CX holds a PEG ratio of 1.51. 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. CX's PEG compares to its industry's average PEG of 1.67. Over the last 12 months, CX's PEG has been as high as 1.59 and as low as 0.90, with a median of 1.19.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CX has a P/S ratio of 1.06. This compares to its industry's average P/S of 2.29.
Value investors will likely look at more than just these metrics, but the above data helps show that Cemex is likely undervalued currently. And when considering the strength of its earnings outlook, CX sticks out as one of the market's strongest value stocks.
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Cemex S.A.B. de C.V. (CX): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).