Are Investors Undervaluing SunCoke Energy (SXC) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
One stock to keep an eye on is SunCoke Energy (SXC). SXC is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A.
Another notable valuation metric for SXC is its P/B ratio of 0.79. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.27. Over the past 12 months, SXC's P/B has been as high as 1.58 and as low as 0.79, with a median of 1.10.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. SXC has a P/S ratio of 0.37. This compares to its industry's average P/S of 0.52.
Finally, we should also recognize that SXC has a P/CF ratio of 1.89. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 2.69. SXC's P/CF has been as high as 6.05 and as low as 1.89, with a median of 2.76, all within the past year.
These are only a few of the key metrics included in SunCoke Energy's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, SXC looks like an impressive value stock at the moment.
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SunCoke Energy, Inc. (SXC) : Free Stock Analysis Report
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