Are These Construction Stocks 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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.
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 D.R. Horton (DHI). DHI is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 5.53, which compares to its industry's average of 5.61. DHI's Forward P/E has been as high as 10.24 and as low as 5.53, with a median of 7.62, all within the past year.
Finally, investors should note that DHI has a P/CF ratio of 6.57. 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. This stock's P/CF looks attractive against its industry's average P/CF of 7.53. Over the past 52 weeks, DHI's P/CF has been as high as 11.77 and as low as 6.57, with a median of 9.17.
Another great Building Products - Home Builders stock you could consider is Loma Negra Compania Industrial Argentina (LOMA), which is a # 1 (Strong Buy) stock with a Value Score of A.
Loma Negra Compania Industrial Argentina is currently trading with a Forward P/E ratio of 4.24 while its PEG ratio sits at 0.13. Both of the company's metrics compare favorably to its industry's average P/E of 5.61 and average PEG ratio of 0.48.
LOMA's Forward P/E has been as high as 13.84 and as low as 4.24, with a median of 9.58. During the same time period, its PEG ratio has been as high as 0.36, as low as 0.13, with a median of 0.24.
Additionally, Loma Negra Compania Industrial Argentina has a P/B ratio of 1.10 while its industry's price-to-book ratio sits at 0.98. For LOMA, this valuation metric has been as high as 1.59, as low as 0.96, with a median of 1.23 over the past year.
These are only a few of the key metrics included in D.R. Horton and Loma Negra Compania Industrial Argentina strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, DHI and LOMA look like an impressive value stock at the moment.
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D.R. Horton, Inc. (DHI) : Free Stock Analysis Report
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