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Is Greif (GEF) Stock Undervalued Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Greif (GEF - Free Report) is a stock many investors are watching right now. GEF is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 11.98. This compares to its industry's average Forward P/E of 13.57. Over the last 12 months, GEF's Forward P/E has been as high as 13.10 and as low as 9.91, with a median of 11.57.

We also note that GEF holds a PEG ratio of 1.20. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. GEF's PEG compares to its industry's average PEG of 2.44. Over the past 52 weeks, GEF's PEG has been as high as 1.31 and as low as 0.99, with a median of 1.16.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GEF has a P/S ratio of 0.61. This compares to its industry's average P/S of 0.88.

Finally, investors will want to recognize that GEF has a P/CF ratio of 6.69. 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. This stock's P/CF looks attractive against its industry's average P/CF of 20.88. Over the past year, GEF's P/CF has been as high as 7.19 and as low as 4.13, with a median of 5.63.

These are only a few of the key metrics included in Greif'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, GEF looks like an impressive value stock at the moment.


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