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Is Cosan (CZZ) 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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 company to watch right now is Cosan . CZZ is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.07. This compares to its industry's average Forward P/E of 11.71. Over the past 52 weeks, CZZ's Forward P/E has been as high as 11.68 and as low as 2.82, with a median of 5.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CZZ has a P/S ratio of 0.39. This compares to its industry's average P/S of 0.41.

Finally, investors should note that CZZ has a P/CF ratio of 2.54. 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. CZZ's current P/CF looks attractive when compared to its industry's average P/CF of 7.38. Over the past 52 weeks, CZZ's P/CF has been as high as 4.14 and as low as 1.81, with a median of 2.84.

These are just a handful of the figures considered in Cosan'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 CZZ is an impressive value stock right now.

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