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Are Investors Undervaluing AdvanSix (ASIX) Right Now?

Zacks Equity Research
Atkore International Group Inc. (ATKR) might move higher on growing optimism about its earnings prospects, which is reflected by its upgrade to a Zacks Rank 2 (Buy).

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 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.

AdvanSix (ASIX) is a stock many investors are watching right now. ASIX is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 8.93, while its industry has an average P/E of 17.83. Over the past year, ASIX's Forward P/E has been as high as 11.71 and as low as 6.39, with a median of 9.69.

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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ASIX has a P/S ratio of 0.53. This compares to its industry's average P/S of 1.47.

These are only a few of the key metrics included in AdvanSix's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ASIX looks like an impressive value stock at the moment.


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