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Are Investors Undervaluing Berry Global (BERY) Right Now?

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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.

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

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 company to watch right now is Berry Global (BERY - Free Report) . BERY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 10.47 right now. For comparison, its industry sports an average P/E of 15.60. Over the past 52 weeks, BERY's Forward P/E has been as high as 14.31 and as low as 6.19, with a median of 9.83.

Investors will also notice that BERY has a PEG ratio of 1.05. 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. BERY's PEG compares to its industry's average PEG of 1.26. Over the past 52 weeks, BERY's PEG has been as high as 1.43 and as low as 0.50, with a median of 0.85.

Another notable valuation metric for BERY is its P/B ratio of 3.85. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 6.79. BERY's P/B has been as high as 4.70 and as low as 2, with a median of 3.38, over the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BERY has a P/S ratio of 0.59. This compares to its industry's average P/S of 1.01.

Finally, we should also recognize that BERY has a P/CF ratio of 5.42. 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. BERY's P/CF compares to its industry's average P/CF of 20.13. Within the past 12 months, BERY's P/CF has been as high as 8.75 and as low as 3.44, with a median of 5.42.

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


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