Should Value Investors Buy These Basic Materials Stocks?

AMR TECK

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Alpha Metallurgical Resources (AMR - Free Report) . AMR is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 3.29, while its industry has an average P/E of 9.30. AMR's Forward P/E has been as high as 1,470.53 and as low as -1,324.11, with a median of 6.35, all within the past year.

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. AMR has a P/S ratio of 1.09. This compares to its industry's average P/S of 2.49.

Another great Mining - Miscellaneous stock you could consider is Teck Resources (TECK - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.

Teck Resources is trading at a forward earnings multiple of 7.96 at the moment, with a PEG ratio of 0.21. This compares to its industry's average P/E of 9.30 and average PEG ratio of 1.

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