Should Value Investors Buy B2Gold Corp (BTG) Stock?
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 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 company value investors might notice is B2Gold Corp (BTG). BTG is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 10.61, while its industry has an average P/E of 18.28. Over the last 12 months, BTG's Forward P/E has been as high as 14.58 and as low as 8.36, with a median of 10.64.
Another valuation metric that we should highlight is BTG's P/B ratio of 1. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. BTG's current P/B looks attractive when compared to its industry's average P/B of 1.13. Within the past 52 weeks, BTG's P/B has been as high as 1.78 and as low as 0.90, with a median of 1.14.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BTG has a P/S ratio of 1.98. This compares to its industry's average P/S of 4.17.
Finally, our model also underscores that BTG has a P/CF ratio of 5.75. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 12.68. BTG's P/CF has been as high as 7.12 and as low as 5.04, with a median of 5.88, all within the past year.
New Gold (NGD) may be another strong Mining - Gold stock to add to your shortlist. NGD is a # 1 (Strong Buy) stock with a Value grade of A.
New Gold is currently trading with a Forward P/E ratio of 13.61 while its PEG ratio sits at 0.24. Both of the company's metrics compare favorably to its industry's average P/E of 18.28 and average PEG ratio of 1.12.
NGD's Forward P/E has been as high as 33.27 and as low as -15.29, with a median of 12.37. During the same time period, its PEG ratio has been as high as 6.65, as low as -3.06, with a median of 2.16.
Additionally, New Gold has a P/B ratio of 1.11 while its industry's price-to-book ratio sits at 1.13. For NGD, this valuation metric has been as high as 1.19, as low as 0.60, with a median of 0.84 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that B2Gold Corp and New Gold are likely undervalued currently. And when considering the strength of its earnings outlook, BTG and NGD sticks out as one of the market's strongest value stocks.
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B2Gold Corp (BTG) : Free Stock Analysis Report
New Gold Inc. (NGD) : Free Stock Analysis Report
