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Is Gold Fields (GFI) a Great Value Stock Right Now?

Zacks Equity Research
Magna (MGA) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

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 company to watch right now is Gold Fields (GFI). GFI is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 22.39 right now. For comparison, its industry sports an average P/E of 30.97. GFI's Forward P/E has been as high as 29.11 and as low as -25.06, with a median of 14.64, all within the past year.

Investors will also notice that GFI has a PEG ratio of 1.33. 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. GFI's industry has an average PEG of 3.87 right now. Within the past year, GFI's PEG has been as high as 1.99 and as low as 1.21, with a median of 1.61.

Another notable valuation metric for GFI is its P/B ratio of 1.04. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. GFI's current P/B looks attractive when compared to its industry's average P/B of 1.31. Over the past 12 months, GFI's P/B has been as high as 1.18 and as low as 0.66, with a median of 0.92.

These are just a handful of the figures considered in Gold Fields's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that GFI is an impressive value stock right now.


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