Should Value Investors Buy Builders FirstSource (BLDR) 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.
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.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company value investors might notice is Builders FirstSource (BLDR). BLDR is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 13.56. This compares to its industry's average Forward P/E of 18.09. Over the past 52 weeks, BLDR's Forward P/E has been as high as 14.88 and as low as 3.62, with a median of 8.30.
Finally, investors will want to recognize that BLDR has a P/CF ratio of 6.35. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 13.25. Over the past 52 weeks, BLDR's P/CF has been as high as 6.35 and as low as 2.57, with a median of 3.49.
Value investors will likely look at more than just these metrics, but the above data helps show that Builders FirstSource is likely undervalued currently. And when considering the strength of its earnings outlook, BLDR sticks out at as one of the market's strongest value stocks.
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Builders FirstSource, Inc. (BLDR) : Free Stock Analysis Report
