Should Value Investors Buy CrossAmerica Partners (CAPL) 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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 to watch right now is CrossAmerica Partners (CAPL). CAPL is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
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. CAPL has a P/S ratio of 0.16. This compares to its industry's average P/S of 0.3.
Finally, our model also underscores that CAPL has a P/CF ratio of 5.42. 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. CAPL's P/CF compares to its industry's average P/CF of 6.60. Within the past 12 months, CAPL's P/CF has been as high as 6.74 and as low as 4.88, with a median of 5.47.
Global Partners (GLP) may be another strong Oil and Gas - Refining and Marketing - Master Limited Partnerships stock to add to your shortlist. GLP is a # 1 (Strong Buy) stock with a Value grade of A.
Global Partners sports a P/B ratio of 1.72 as well; this compares to its industry's price-to-book ratio of 3.49. In the past 52 weeks, GLP's P/B has been as high as 2.01, as low as 1.37, with a median of 1.71.
These are only a few of the key metrics included in CrossAmerica Partners and Global Partners strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, CAPL and GLP look like an impressive value stock at the moment.
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CrossAmerica Partners LP (CAPL) : Free Stock Analysis Report
Global Partners LP (GLP) : Free Stock Analysis Report
