Is AdvanSix (ASIX) Stock Undervalued Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 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 to watch right now is AdvanSix (ASIX). ASIX is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 4.97 right now. For comparison, its industry sports an average P/E of 12.72. Over the past year, ASIX's Forward P/E has been as high as 10.95 and as low as 4.10, with a median of 8.28.
Investors should also recognize that ASIX has a P/B ratio of 1.61. 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. ASIX's current P/B looks attractive when compared to its industry's average P/B of 3.59. Within the past 52 weeks, ASIX's P/B has been as high as 2.66 and as low as 1.34, with a median of 2.01.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ASIX has a P/S ratio of 0.61. This compares to its industry's average P/S of 1.62.
Finally, our model also underscores that ASIX has a P/CF ratio of 4.59. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 9.19. Within the past 12 months, ASIX's P/CF has been as high as 8.12 and as low as 3.82, with a median of 6.14.
These figures are just a handful of the metrics value investors tend to look at, but they help show that AdvanSix is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ASIX feels like a great value stock at the moment.
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