Is Commercial Metals (CMC) Stock Undervalued 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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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 company value investors might notice is Commercial Metals (CMC). CMC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 10.72, while its industry has an average P/E of 21.23. Over the past year, CMC's Forward P/E has been as high as 10.72 and as low as 6.50, with a median of 8.51.
Investors should also note that CMC holds a PEG ratio of 2.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CMC's PEG compares to its industry's average PEG of 3.84. Within the past year, CMC's PEG has been as high as 5.97 and as low as 0.70, with a median of 2.30.
These are only a few of the key metrics included in Commercial Metals's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, CMC looks like an impressive value stock at the moment.
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