Should Value Investors Buy CVR Energy (CVI) 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 CVR Energy (CVI). CVI is currently sporting a Zacks Rank of #1 (Strong 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. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CVI has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.35.
Finally, investors should note that CVI has a P/CF ratio of 4.05. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 4.97. Within the past 12 months, CVI's P/CF has been as high as 6.56 and as low as 2.74, with a median of 4.23.
Investors could also keep in mind Par Pacific (PARR), an Oil and Gas - Refining and Marketing stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Par Pacific also has a P/B ratio of 2.17 compared to its industry's price-to-book ratio of 2.04. Over the past year, its P/B ratio has been as high as 2.79, as low as 1.41, with a median of 2.28.
Value investors will likely look at more than just these metrics, but the above data helps show that CVR Energy and Par Pacific are likely undervalued currently. And when considering the strength of its earnings outlook, CVI and PARR sticks out as one of the market's strongest value stocks.
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CVR Energy Inc. (CVI) : Free Stock Analysis Report
Par Pacific Holdings, Inc. (PARR) : Free Stock Analysis Report
