Are Investors Undervaluing Teck Resources (TECK) 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 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.
One stock to keep an eye on is Teck Resources (TECK). TECK 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 7.80. This compares to its industry's average Forward P/E of 10.37. Over the last 12 months, TECK's Forward P/E has been as high as 10.87 and as low as 5.17, with a median of 9.22.
We should also highlight that TECK has a P/B ratio of 0.88. 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. TECK's current P/B looks attractive when compared to its industry's average P/B of 1.54. Over the past year, TECK's P/B has been as high as 1.21 and as low as 0.77, with a median of 1.02.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. TECK has a P/S ratio of 1.78. This compares to its industry's average P/S of 1.94.
Finally, investors will want to recognize that TECK has a P/CF ratio of 7.58. 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 21.38. TECK's P/CF has been as high as 9.58 and as low as 3.24, with a median of 6.36, all within the past year.
These are just a handful of the figures considered in Teck Resources'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 TECK is an impressive value stock right now.
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Teck Resources Ltd (TECK) : Free Stock Analysis Report
