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Are Investors Undervaluing Griffon (GFF) Right Now?

Zacks Equity Research
·2 min 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Griffon (GFF) is a stock many investors are watching right now. GFF is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 23.09. This compares to its industry's average Forward P/E of 25.46. Over the past 52 weeks, GFF's Forward P/E has been as high as 23.62 and as low as 6.43, with a median of 14.14.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GFF has a P/S ratio of 0.41. This compares to its industry's average P/S of 0.91.

Finally, investors will want to recognize that GFF has a P/CF ratio of 7.83. 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 30.84. Within the past 12 months, GFF's P/CF has been as high as 10.59 and as low as 3.93, with a median of 8.33.

These are just a handful of the figures considered in Griffon'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 GFF is an impressive value stock right now.


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Zacks Investment Research