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Are Investors Undervaluing Bunge (BG) Right Now?

Zacks Equity Research
·2 mins read

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 company to watch right now is Bunge (BG). BG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 9.34 right now. For comparison, its industry sports an average P/E of 21.23. BG's Forward P/E has been as high as 21.61 and as low as 7.89, with a median of 16.18, all within the past year.

We should also highlight that BG has a P/B ratio of 0.96. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. BG's current P/B looks attractive when compared to its industry's average P/B of 1.66. Over the past year, BG's P/B has been as high as 2.06 and as low as 0.80, with a median of 1.37.

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


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Zacks Investment Research