Is Centerra Gold (CGAU) a Great Value Stock Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
One company to watch right now is Centerra Gold (CGAU). CGAU is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 7.76, while its industry has an average P/E of 13.60. Over the last 12 months, CGAU's Forward P/E has been as high as 14.67 and as low as 6.95, with a median of 8.95.
Another valuation metric that we should highlight is CGAU's P/B ratio of 0.84. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 0.94. CGAU's P/B has been as high as 1.52 and as low as 0.83, with a median of 1.23, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CGAU has a P/S ratio of 1.87. This compares to its industry's average P/S of 2.39.
Investors could also keep in mind Gold Resource (GORO), an Mining - Gold stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Furthermore, Gold Resource holds a P/B ratio of 1.12 and its industry's price-to-book ratio is 0.94. GORO's P/B has been as high as 1.85, as low as 0.94, with a median of 1.34 over the past 12 months.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Centerra Gold and Gold Resource are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CGAU and GORO feels like a great value stock at the moment.
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Centerra Gold Inc. (CGAU) : Free Stock Analysis Report
Gold Resource Corporation (GORO) : Free Stock Analysis Report
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