Is Commercial Vehicle Group (CVGI) 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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Commercial Vehicle Group (CVGI). CVGI is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 8.88, which compares to its industry's average of 18.87. CVGI's Forward P/E has been as high as 12.38 and as low as 3.72, with a median of 9.40, all within the past year.
Investors should also note that CVGI holds a PEG ratio of 0.40. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CVGI's PEG compares to its industry's average PEG of 0.85. CVGI's PEG has been as high as 0.59 and as low as 0.18, with a median of 0.44, all within the past year.
Another valuation metric that we should highlight is CVGI's P/B ratio of 2.29. 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 attractive against its industry's average P/B of 2.83. Within the past 52 weeks, CVGI's P/B has been as high as 2.72 and as low as 1, with a median of 1.90.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CVGI has a P/S ratio of 0.31. This compares to its industry's average P/S of 0.91.
Another great Automotive - Original Equipment stock you could consider is Garrett Motion (GTX), which is a # 2 (Buy) stock with a Value Score of A.
Garrett Motion also has a P/B ratio of -3.32 compared to its industry's price-to-book ratio of 2.83. Over the past year, its P/B ratio has been as high as -1.61, as low as -6.94, with a median of -4.41.
Value investors will likely look at more than just these metrics, but the above data helps show that Commercial Vehicle Group and Garrett Motion are likely undervalued currently. And when considering the strength of its earnings outlook, CVGI and GTX sticks out as one of the market's strongest value stocks.
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Commercial Vehicle Group, Inc. (CVGI) : Free Stock Analysis Report
Garrett Motion Inc. (GTX) : Free Stock Analysis Report
