Should Value Investors Buy American Woodmark (AMWD) Stock?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 company to watch right now is American Woodmark (AMWD). AMWD is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 10.93. This compares to its industry's average Forward P/E of 12.57. AMWD's Forward P/E has been as high as 11.88 and as low as 7.21, with a median of 9.57, all within the past year.
Investors should also recognize that AMWD has a P/B ratio of 1.43. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.75. Within the past 52 weeks, AMWD's P/B has been as high as 1.47 and as low as 0.88, with a median of 1.07.
Finally, we should also recognize that AMWD has a P/CF ratio of 6.30. 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. This stock's P/CF looks attractive against its industry's average P/CF of 8.04. Over the past year, AMWD's P/CF has been as high as 10.42 and as low as 4.36, with a median of 6.42.
These are only a few of the key metrics included in American Woodmark'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, AMWD looks like an impressive value stock at the moment.
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American Woodmark Corporation (AMWD) : Free Stock Analysis Report
