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Is PGT Innovations (PGTI) a Great Value Stock Right Now?

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·3 min read
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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is PGT Innovations (PGTI). PGTI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 11.53, while its industry has an average P/E of 14.15. PGTI's Forward P/E has been as high as 22.60 and as low as 11.53, with a median of 15.75, all within the past year.

Investors should also recognize that PGTI has a P/B ratio of 2.27. 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 attractive against its industry's average P/B of 3.31. PGTI's P/B has been as high as 3.29 and as low as 2.03, with a median of 2.51, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. PGTI has a P/S ratio of 0.99. This compares to its industry's average P/S of 1.36.

Finally, we should also recognize that PGTI has a P/CF ratio of 15.27. 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. PGTI's current P/CF looks attractive when compared to its industry's average P/CF of 18.21. PGTI's P/CF has been as high as 19 and as low as 12.35, with a median of 16.36, all within the past year.

These are just a handful of the figures considered in PGT Innovations'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 PGTI is an impressive value stock right now.


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