Is Silgan Holdings (SLGN) a Great Value Stock 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.
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.
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.
Silgan Holdings (SLGN) is a stock many investors are watching right now. SLGN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 10.74 right now. For comparison, its industry sports an average P/E of 17.37. Over the past year, SLGN's Forward P/E has been as high as 12.90 and as low as 10.56, with a median of 11.56.
Investors will also notice that SLGN has a PEG ratio of 2.15. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. SLGN's industry currently sports an average PEG of 3.47. Over the past 52 weeks, SLGN's PEG has been as high as 2.58 and as low as 2.11, with a median of 2.31.
We should also highlight that SLGN has a P/B ratio of 2.96. Investors use the P/B ratio to look at a stock's market value versus 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 6.63. SLGN's P/B has been as high as 3.83 and as low as 2.85, with a median of 3.24, over the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. SLGN has a P/S ratio of 0.8. This compares to its industry's average P/S of 1.25.
Finally, investors should note that SLGN has a P/CF ratio of 7.58. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 20.69. Over the past year, SLGN's P/CF has been as high as 9.07 and as low as 7.21, with a median of 8.
Value investors will likely look at more than just these metrics, but the above data helps show that Silgan Holdings is likely undervalued currently. And when considering the strength of its earnings outlook, SLGN sticks out at as one of the market's strongest value stocks.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Silgan Holdings Inc. (SLGN) : Free Stock Analysis Report
To read this article on Zacks.com click here.
