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Are Investors Undervaluing Central Garden (CENT) Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

Central Garden (CENT) is a stock many investors are watching right now. CENT is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Another notable valuation metric for CENT is its P/B ratio of 2.13. 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 stock's P/B looks attractive against its industry's average P/B of 4.43. Over the past 12 months, CENT's P/B has been as high as 2.25 and as low as 1.43, with a median of 1.92.

Finally, our model also underscores that CENT has a P/CF ratio of 12.84. 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. CENT's P/CF compares to its industry's average P/CF of 16.85. Over the past 52 weeks, CENT's P/CF has been as high as 14.35 and as low as 9.83, with a median of 12.52.

These are just a handful of the figures considered in Central Garden'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 CENT is an impressive value stock right now.


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