Back to top

Image: Bigstock

Are Investors Undervaluing Lsb Industries (LXU) Right Now?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

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.

One stock to keep an eye on is Lsb Industries (LXU - Free Report) . LXU is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 8.30, while its industry has an average P/E of 19.43. Over the past 52 weeks, LXU's Forward P/E has been as high as 13.28 and as low as 4.22, with a median of 6.59.

We should also highlight that LXU has a P/B ratio of 1.19. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. LXU's current P/B looks attractive when compared to its industry's average P/B of 3.56. Within the past 52 weeks, LXU's P/B has been as high as 2.40 and as low as 1.09, with a median of 1.44.

Finally, investors will want to recognize that LXU has a P/CF ratio of 3.90. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. LXU's P/CF compares to its industry's average P/CF of 15.58. Over the past 52 weeks, LXU's P/CF has been as high as 4.81 and as low as 2.47, with a median of 3.76.

These are only a few of the key metrics included in Lsb Industries's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, LXU looks like an impressive value stock at the moment.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Lsb Industries Inc. (LXU) - free report >>

Published in