Are Investors Undervaluing Warrior Met Coal (HCC) Right Now?

HCC

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 to watch right now is Warrior Met Coal (HCC - Free Report) . HCC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Another notable valuation metric for HCC is its P/B ratio of 1.37. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. HCC's current P/B looks attractive when compared to its industry's average P/B of 1.85. HCC's P/B has been as high as 2.52 and as low as 1.08, with a median of 1.62, over the past year.

Finally, investors should note that HCC has a P/CF ratio of 2.36. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 4.73. HCC's P/CF has been as high as 11.30 and as low as 1.86, with a median of 4.17, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Warrior Met Coal is likely undervalued currently. And when considering the strength of its earnings outlook, HCC sticks out at as one of the market's strongest value stocks.

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