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Is PulteGroup (PHM) a Great Value Stock Right Now?

Zacks Equity Research
Malibu Boats (MBUU) closed at $36.27 in the latest trading session, marking a -1.09% move from the prior day.

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 PulteGroup (PHM). PHM is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with a P/E ratio of 9.17, which compares to its industry's average of 10.11. PHM's Forward P/E has been as high as 10.04 and as low as 5.47, with a median of 7.95, all within the past year.

Finally, we should also recognize that PHM has a P/CF ratio of 8.36. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. PHM's P/CF compares to its industry's average P/CF of 8.87. Over the past 52 weeks, PHM's P/CF has been as high as 16.49 and as low as 6.53, with a median of 8.07.

These are only a few of the key metrics included in PulteGroup'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, PHM looks like an impressive value stock at the moment.


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