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Is CAI International (CAI) a Great Value Stock Right Now?

Zacks Equity Research
·2 min read

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.

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.

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 stock to keep an eye on is CAI International (CAI). CAI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 6.72, while its industry has an average P/E of 12.20. Over the past year, CAI's Forward P/E has been as high as 18.76 and as low as 3.84, with a median of 7.26.

Finally, we should also recognize that CAI has a P/CF ratio of 3.90. 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. CAI's current P/CF looks attractive when compared to its industry's average P/CF of 4.93. Over the past 52 weeks, CAI's P/CF has been as high as 4 and as low as 1.27, with a median of 2.94.

These figures are just a handful of the metrics value investors tend to look at, but they help show that CAI International is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CAI feels like a great value stock at the moment.


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Zacks Investment Research