Is Sibanye Gold Limited (SBSW) a Great Value Stock Right Now?

SBSW

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.

Sibanye Gold Limited (SBSW - Free Report) is a stock many investors are watching right now. SBSW is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 5.03. This compares to its industry's average Forward P/E of 10.92. Over the last 12 months, SBSW's Forward P/E has been as high as 6.84 and as low as 2.37, with a median of 4.26.

We should also highlight that SBSW has a P/B ratio of 2.99. 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. SBSW's current P/B looks attractive when compared to its industry's average P/B of 3.36. SBSW's P/B has been as high as 4.49 and as low as 1.92, with a median of 2.85, over the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Sibanye Gold Limited is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SBSW feels like a great value stock at the moment.

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