Should Value Investors Buy Greif (GEF) Stock?

GEF

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.

One company value investors might notice is Greif (GEF - Free Report) . GEF is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 11.61. This compares to its industry's average Forward P/E of 16.27. GEF's Forward P/E has been as high as 16.95 and as low as 9.85, with a median of 13.26, all within the past year.

GEF is also sporting a PEG ratio of 1.16. 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 1.80. Over the past 52 weeks, GEF's PEG has been as high as 1.70 and as low as 0.99, with a median of 1.33.

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. GEF has a P/S ratio of 0.62. This compares to its industry's average P/S of 1.32.

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

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