Should Value Investors Buy Amplify Energy (AMPY) Stock?
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
Amplify Energy (AMPY) is a stock many investors are watching right now. AMPY 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 2.64, which compares to its industry's average of 7.70. Over the past year, AMPY's Forward P/E has been as high as 8.30 and as low as -18.31, with a median of 5.97.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. AMPY has a P/S ratio of 0.71. This compares to its industry's average P/S of 1.74.
Value investors will likely look at more than just these metrics, but the above data helps show that Amplify Energy is likely undervalued currently. And when considering the strength of its earnings outlook, AMPY sticks out at as one of the market's strongest value stocks.
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Amplify Energy Corp. (AMPY) : Free Stock Analysis Report
