Are Investors Undervaluing PetIQ (PETQ) 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.
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 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 company value investors might notice is PetIQ (PETQ). PETQ is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 13.77, which compares to its industry's average of 21.31. Over the past 52 weeks, PETQ's Forward P/E has been as high as 22.18 and as low as 10.83, with a median of 16.07.
We also note that PETQ holds a PEG ratio of 1.90. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PETQ's PEG compares to its industry's average PEG of 2.27. Over the last 12 months, PETQ's PEG has been as high as 2.77 and as low as 1.35, with a median of 2.06.
Finally, investors should note that PETQ has a P/CF ratio of 9.25. 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. PETQ's current P/CF looks attractive when compared to its industry's average P/CF of 35.47. PETQ's P/CF has been as high as 13.39 and as low as 8.36, with a median of 9.99, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that PetIQ is likely undervalued currently. And when considering the strength of its earnings outlook, PETQ sticks out at as one of the market's strongest value stocks.
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PetIQ, Inc. (PETQ) : Free Stock Analysis Report
