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Should Value Investors Buy Canadian Solar (CSIQ) Stock?

Zacks Equity Research
In the latest trading session, Veeva Systems (VEEV) closed at $143.14, marking a +1.76% move from the previous day.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

One stock to keep an eye on is Canadian Solar (CSIQ). CSIQ 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 8.51, which compares to its industry's average of 25.34. Over the last 12 months, CSIQ's Forward P/E has been as high as 11.86 and as low as 5.42, with a median of 8.06.

We should also highlight that CSIQ has a P/B ratio of 0.99. 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 1.29. Within the past 52 weeks, CSIQ's P/B has been as high as 0.99 and as low as 0.60, with a median of 0.78.

These are only a few of the key metrics included in Canadian Solar'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, CSIQ looks like an impressive value stock at the moment.


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