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Is Arkema SA (ARKAY) a Great Value Stock Right Now?

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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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Arkema SA (ARKAY - Free Report) . ARKAY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 15.67 right now. For comparison, its industry sports an average P/E of 21.22. ARKAY's Forward P/E has been as high as 17.28 and as low as 5.70, with a median of 14.98, all within the past year.

Another notable valuation metric for ARKAY is its P/B ratio of 1.38. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.70. Over the past year, ARKAY's P/B has been as high as 1.48 and as low as 0.63, with a median of 1.32.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. ARKAY has a P/S ratio of 0.95. This compares to its industry's average P/S of 1.11.

Finally, we should also recognize that ARKAY has a P/CF ratio of 7.83. 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 11.73. Within the past 12 months, ARKAY's P/CF has been as high as 8.40 and as low as 3.53, with a median of 6.51.

These are only a few of the key metrics included in Arkema SA's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, ARKAY looks like an impressive value stock at the moment.


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