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Is Crescent Point Energy (CPG) Stock Undervalued Right Now?

Zacks Equity Research

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 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 value investors might notice is Crescent Point Energy (CPG). CPG is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 10.06, while its industry has an average P/E of 11.42. Over the past year, CPG's Forward P/E has been as high as 25.41 and as low as -16.13, with a median of 10.04.

Another valuation metric that we should highlight is CPG's P/B ratio of 0.41. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. CPG's current P/B looks attractive when compared to its industry's average P/B of 0.77. CPG's P/B has been as high as 0.52 and as low as 0.22, with a median of 0.35, over the past year.

Finally, our model also underscores that CPG has a P/CF ratio of 0.89. 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. CPG's P/CF compares to its industry's average P/CF of 2.73. Over the past year, CPG's P/CF has been as high as 3.95 and as low as 0.65, with a median of 0.90.

Value investors will likely look at more than just these metrics, but the above data helps show that Crescent Point Energy is likely undervalued currently. And when considering the strength of its earnings outlook, CPG sticks out at as one of the market's strongest value stocks.


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