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Should Value Investors Buy Companhia Brasileira de Distribuicao (CBD) Stock?

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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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 value investors might notice is Companhia Brasileira de Distribuicao . CBD is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 12.60 right now. For comparison, its industry sports an average P/E of 20.63. Over the past 52 weeks, CBD's Forward P/E has been as high as 17.15 and as low as 3.35, with a median of 11.89.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CBD has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.32.

If you're looking for another solid Retail - Supermarkets value stock, take a look at The Kroger Co. (KR - Free Report) . KR is a # 2 (Buy) stock with a Value score of A.

The Kroger Co. is currently trading with a Forward P/E ratio of 11.03 while its PEG ratio sits at 0.94. Both of the company's metrics compare favorably to its industry's average P/E of 20.63 and average PEG ratio of 3.04.

KR's Forward P/E has been as high as 16.61 and as low as 10.15, with a median of 12.93. During the same time period, its PEG ratio has been as high as 1.98, as low as 0.87, with a median of 1.42.

Furthermore, The Kroger Co. holds a P/B ratio of 3.39 and its industry's price-to-book ratio is 3.79. KR's P/B has been as high as 4.81, as low as 3.13, with a median of 3.61 over the past 12 months.

These are only a few of the key metrics included in Companhia Brasileira de Distribuicao and The Kroger Co. strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, CBD and KR look like an impressive value stock at the moment.


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