Are Investors Undervaluing Comstock Resources (CRK) Right Now?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Comstock Resources (CRK). CRK is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 3.47, which compares to its industry's average of 5.82. Over the past year, CRK's Forward P/E has been as high as 7.27 and as low as 2.49, with a median of 4.03.
Investors should also recognize that CRK has a P/B ratio of 3.33. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. CRK's current P/B looks attractive when compared to its industry's average P/B of 3.45. Over the past year, CRK's P/B has been as high as 5.57 and as low as 1.64, with a median of 3.15.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CRK has a P/S ratio of 1.56. This compares to its industry's average P/S of 1.79.
Finally, our model also underscores that CRK has a P/CF ratio of 6.17. 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 8.21. Over the past year, CRK's P/CF has been as high as 18.77 and as low as -86.47, with a median of 6.90.
Another great Oil and Gas - Exploration and Production - United States stock you could consider is Stone Energy (TALO), which is a # 2 (Buy) stock with a Value Score of A.
Stone Energy sports a P/B ratio of 2 as well; this compares to its industry's price-to-book ratio of 3.45. In the past 52 weeks, TALO's P/B has been as high as 2.99, as low as 1.05, with a median of 1.63.
These are only a few of the key metrics included in Comstock Resources and Stone Energy strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, CRK and TALO look like an impressive value stock at the moment.
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Comstock Resources, Inc. (CRK) : Free Stock Analysis Report
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