Is Greif (GEF) 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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is Greif (GEF). GEF 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 12.07, which compares to its industry's average of 12.67. GEF's Forward P/E has been as high as 13.10 and as low as 8.14, with a median of 10.79, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GEF has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.87.
Finally, investors will want to recognize that GEF has a P/CF ratio of 6.23. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 20.99. GEF's P/CF has been as high as 6.42 and as low as 4.13, with a median of 5.17, all within the past year.
Another great Containers - Paper and Packaging stock you could consider is Sonoco (SON), which is a # 2 (Buy) stock with a Value Score of A.
Shares of Sonoco currently holds a Forward P/E ratio of 10.09, and its PEG ratio is 2.02. In comparison, its industry sports average P/E and PEG ratios of 12.67 and 1.
Over the past year, SON's P/E has been as high as 11.19, as low as 9.11, with a median of 10.17; its PEG ratio has been as high as 2.24, as low as 1.82, with a median of 1.08 during the same time period.
Sonoco sports a P/B ratio of 2.65 as well; this compares to its industry's price-to-book ratio of 8.04. In the past 52 weeks, SON's P/B has been as high as 3.31, as low as 2.55, with a median of 2.87.
Value investors will likely look at more than just these metrics, but the above data helps show that Greif and Sonoco are likely undervalued currently. And when considering the strength of its earnings outlook, GEF and SON sticks out as one of the market's strongest value stocks.
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Greif, Inc. (GEF) : Free Stock Analysis Report
Sonoco Products Company (SON) : Free Stock Analysis Report
