Should Value Investors Buy California Resources (CRC) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is California Resources (CRC). CRC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 7.40. This compares to its industry's average Forward P/E of 8.03. Over the last 12 months, CRC's Forward P/E has been as high as 10.91 and as low as 5.17, with a median of 7.01.
Another notable valuation metric for CRC is its P/B ratio of 1.71. Investors use the P/B ratio to look at a stock's market value versus 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 2.35. Within the past 52 weeks, CRC's P/B has been as high as 1.90 and as low as 1.27, with a median of 1.67.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CRC has a P/S ratio of 1.27. This compares to its industry's average P/S of 1.82.
Value investors will likely look at more than just these metrics, but the above data helps show that California Resources is likely undervalued currently. And when considering the strength of its earnings outlook, CRC sticks out at as one of the market's strongest value stocks.
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California Resources Corporation (CRC) : Free Stock Analysis Report
