Is Compass Diversified Holdings (CODI) Stock A Great Combo of Value and Growth?

Zacks Equity Research
May 29, 2014

Value investing is always a very popular strategy, and for good reason. After all, who doesn’t want to find stocks that have low PEs, solid outlooks, and decent dividends?

Fortunately for investors looking for this combination, we have identified a strong candidate which may be an impressive value; Compass Diversified Holdings (CODI).

Compass Diversified Holdings in Focus   

CODI may be an interesting play thanks to its forward PE of 14.89, its P/S ratio of 0.85, and its decent dividend yield of 8.25%. These factors suggest that Compass Diversified Holdings is a pretty good value pick, as investors have to pay a relatively low level for each dollar of earnings, and that CODI has decent revenue metrics to back up its earnings.

But before you think that Compass Diversified Holdings is just a pure value play, it is important to note that it has been seeing solid activity on the earnings estimate front as well. For current year earnings, the consensus has gone up by 3.5% in the past 30 days, thanks to 3 upward revisions in the past one month compared to no downward revision.  

This estimate strength is actually enough to push CODI to a Zacks Rank #2 (Buy), suggesting it is poised to outperform. So really, Compass Diversified Holdings is looking great from a number of angles thanks to its PE below 20, a P/S ratio below one, and a strong Zacks Rank, meaning that this company could be a great choice for value investors at this time.  

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>


Zacks Investment Research