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Are Investors Undervaluing Posco (PKX) 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.

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

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.

Posco (PKX) is a stock many investors are watching right now. PKX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 9.50. This compares to its industry's average Forward P/E of 10.79. Over the past 52 weeks, PKX's Forward P/E has been as high as 9.57 and as low as 4.78, with a median of 8.12.

Investors should also recognize that PKX has a P/B ratio of 0.52. 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 solid versus its industry's average P/B of 0.91. PKX's P/B has been as high as 0.52 and as low as 0.24, with a median of 0.38, over the past year.

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


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