Are Investors Undervaluing Builders FirstSource (BLDR) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Builders FirstSource (BLDR). BLDR is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 11.01. This compares to its industry's average Forward P/E of 18.29. Over the past year, BLDR's Forward P/E has been as high as 14.88 and as low as 3.62, with a median of 11.62.
Finally, our model also underscores that BLDR has a P/CF ratio of 7.54. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.93. BLDR's P/CF has been as high as 8.09 and as low as 2.57, with a median of 3.80, all within the past year.
These are just a handful of the figures considered in Builders FirstSource'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 BLDR is an impressive value stock right now.
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
Builders FirstSource, Inc. (BLDR) : Free Stock Analysis Report
