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Is Smucker (SJM) a Great Value Stock Right Now?

Zacks Equity Research
Calumet Specialty Products Partners, L.P. (CLMT) closed the most recent trading day at $4.17, moving +1.21% from the previous trading session.

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Smucker (SJM). SJM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 14.52, which compares to its industry's average of 17.32. Over the last 12 months, SJM's Forward P/E has been as high as 14.54 and as low as 10.88, with a median of 12.55.

Investors should also recognize that SJM has a P/B ratio of 1.74. 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 2.02. SJM's P/B has been as high as 1.74 and as low as 1.32, with a median of 1.53, over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Smucker is likely undervalued currently. And when considering the strength of its earnings outlook, SJM sticks out at as one of the market's strongest value stocks.


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