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Are Investors Undervaluing Greenhill & Co., Inc. (GHL) 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 stock to keep an eye on is Greenhill & Co., Inc. . GHL is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 10.04 right now. For comparison, its industry sports an average P/E of 13. Over the past 52 weeks, GHL's Forward P/E has been as high as 207.72 and as low as -288.86, with a median of 11.37.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. GHL has a P/S ratio of 1.07. This compares to its industry's average P/S of 2.11.

Finally, investors should note that GHL has a P/CF ratio of 9.24. 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. GHL's current P/CF looks attractive when compared to its industry's average P/CF of 17.79. Within the past 12 months, GHL's P/CF has been as high as 12.35 and as low as -76.37, with a median of 8.93.

Value investors will likely look at more than just these metrics, but the above data helps show that Greenhill & Co., Inc. Is likely undervalued currently. And when considering the strength of its earnings outlook, GHL sticks out at as one of the market's strongest value stocks.

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