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Should Value Investors Buy Synnex (SNX) Stock?

Zacks Equity Research

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Synnex (SNX). SNX is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 7.47. This compares to its industry's average Forward P/E of 20.93. SNX's Forward P/E has been as high as 10.30 and as low as 6.31, with a median of 8.05, all within the past year.

We also note that SNX holds a PEG ratio of 0.62. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SNX's industry currently sports an average PEG of 1.83. Within the past year, SNX's PEG has been as high as 0.74 and as low as 0.59, with a median of 0.67.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Synnex is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SNX feels like a great value stock at the moment.


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