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Is Warrior Met Coal (HCC) a Great Value Stock Right Now?

Zacks Equity Research

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Warrior Met Coal (HCC). HCC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 4.10. This compares to its industry's average Forward P/E of 7.56. Over the past 52 weeks, HCC's Forward P/E has been as high as 6.72 and as low as 2.67, with a median of 4.79.

Finally, our model also underscores that HCC has a P/CF ratio of 1.58. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 1.98. Over the past year, HCC's P/CF has been as high as 3.04 and as low as 1.49, with a median of 2.09.

These are just a handful of the figures considered in Warrior Met Coal's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that HCC is an impressive value stock right now.


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