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Is Intrepid Potash (IPI) Stock Undervalued Right Now?

·2 min read

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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 stock to keep an eye on is Intrepid Potash (IPI). IPI is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Another valuation metric that we should highlight is IPI's P/B ratio of 0.80. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.72. Over the past 12 months, IPI's P/B has been as high as 2.35 and as low as 0.70, with a median of 1.14.

Finally, investors should note that IPI has a P/CF ratio of 1.80. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 5.93. Over the past year, IPI's P/CF has been as high as 11.09 and as low as 1.58, with a median of 3.66.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Intrepid Potash is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, IPI feels like a great value stock at the moment.


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