Is Capstar Financial (CSTR) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.
One stock to keep an eye on is Capstar Financial (CSTR). CSTR is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Another valuation metric that we should highlight is CSTR's P/B ratio of 1.21. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.62. CSTR's P/B has been as high as 1.48 and as low as 1.15, with a median of 1.27, over the past year.
Finally, investors should note that CSTR has a P/CF ratio of 9.73. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. CSTR's current P/CF looks attractive when compared to its industry's average P/CF of 10.63. Over the past 52 weeks, CSTR's P/CF has been as high as 15.32 and as low as 9.54, with a median of 11.05.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Capstar Financial is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CSTR feels like a great value stock at the moment.
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