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Should Value Investors Buy These Oils-Energy Stocks?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Plains Group (PAGP - Free Report) is a stock many investors are watching right now. PAGP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 7.50, which compares to its industry's average of 15.22. Over the past year, PAGP's Forward P/E has been as high as 29.02 and as low as 2.71, with a median of 11.26.
Finally, investors should note that PAGP has a P/CF ratio of 2.59. 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 stock's P/CF looks attractive against its industry's average P/CF of 9.64. Within the past 12 months, PAGP's P/CF has been as high as 3.50 and as low as 0.66, with a median of 2.84.
If you're looking for another solid Oil and Gas - Production and Pipelines value stock, take a look at Ultrapar Participacoes (UGP - Free Report) . UGP is a # 2 (Buy) stock with a Value score of A.
Shares of Ultrapar Participacoes are currently trading at a forward earnings multiple of 13.39 and a PEG ratio of 0.60 compared to its industry's P/E and PEG ratios of 15.22 and 2.05, respectively.
Over the last 12 months, UGP's P/E has been as high as 18.06, as low as 8.54, with a median of 13.09, and its PEG ratio has been as high as 0.81, as low as 0.36, with a median of 0.51.
Ultrapar Participacoes also has a P/B ratio of 1.66 compared to its industry's price-to-book ratio of 1.78. Over the past year, its P/B ratio has been as high as 2.73, as low as 1.53, with a median of 2.01.
These are just a handful of the figures considered in Plains Group and Ultrapar Participacoes'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 PAGP and UGP is an impressive value stock right now.
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Should Value Investors Buy These Oils-Energy Stocks?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Plains Group (PAGP - Free Report) is a stock many investors are watching right now. PAGP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 7.50, which compares to its industry's average of 15.22. Over the past year, PAGP's Forward P/E has been as high as 29.02 and as low as 2.71, with a median of 11.26.
Finally, investors should note that PAGP has a P/CF ratio of 2.59. 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 stock's P/CF looks attractive against its industry's average P/CF of 9.64. Within the past 12 months, PAGP's P/CF has been as high as 3.50 and as low as 0.66, with a median of 2.84.
If you're looking for another solid Oil and Gas - Production and Pipelines value stock, take a look at Ultrapar Participacoes (UGP - Free Report) . UGP is a # 2 (Buy) stock with a Value score of A.
Shares of Ultrapar Participacoes are currently trading at a forward earnings multiple of 13.39 and a PEG ratio of 0.60 compared to its industry's P/E and PEG ratios of 15.22 and 2.05, respectively.
Over the last 12 months, UGP's P/E has been as high as 18.06, as low as 8.54, with a median of 13.09, and its PEG ratio has been as high as 0.81, as low as 0.36, with a median of 0.51.
Ultrapar Participacoes also has a P/B ratio of 1.66 compared to its industry's price-to-book ratio of 1.78. Over the past year, its P/B ratio has been as high as 2.73, as low as 1.53, with a median of 2.01.
These are just a handful of the figures considered in Plains Group and Ultrapar Participacoes'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 PAGP and UGP is an impressive value stock right now.