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Is GP Strategies (GPX) Stock Undervalued 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.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

GP Strategies is a stock many investors are watching right now. GPX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 14.72 right now. For comparison, its industry sports an average P/E of 32.42. GPX's Forward P/E has been as high as 30.69 and as low as 14.19, with a median of 17.36, all within the past year.

Investors will also notice that GPX has a PEG ratio of 0.98. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GPX's PEG compares to its industry's average PEG of 1.20. Within the past year, GPX's PEG has been as high as 2.05 and as low as 0.95, with a median of 1.16.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GPX has a P/S ratio of 0.62. This compares to its industry's average P/S of 1.13.

Value investors will likely look at more than just these metrics, but the above data helps show that GP Strategies is likely undervalued currently. And when considering the strength of its earnings outlook, GPX sticks out at as one of the market's strongest value stocks.

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