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Is Cumulus Media (CMLS) Stock Undervalued Right Now?

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·3 min read
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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 stock to keep an eye on is Cumulus Media (CMLS). CMLS is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CMLS has a P/S ratio of 0.25. This compares to its industry's average P/S of 0.73.

Finally, our model also underscores that CMLS has a P/CF ratio of 2.79. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 10.93. CMLS's P/CF has been as high as 11.21 and as low as -655.37, with a median of 3.78, all within the past year.

Another great Broadcast Radio and Television stock you could consider is Entravision Communications (EVC), which is a # 2 (Buy) stock with a Value Score of A.

Furthermore, Entravision Communications holds a P/B ratio of 1.74 and its industry's price-to-book ratio is 9.35. EVC's P/B has been as high as 3.11, as low as 1.35, with a median of 2.09 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 Cumulus Media and Entravision Communications are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CMLS and EVC feels like a great value stock at the moment.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Cumulus Media, Inc. (CMLS) : Free Stock Analysis Report
Entravision Communications Corporation (EVC) : Free Stock Analysis Report
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