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Are Investors Undervaluing Greif (GEF) 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Greif (GEF - Free Report) is a stock many investors are watching right now. GEF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.57, while its industry has an average P/E of 15.88. Over the past 52 weeks, GEF's Forward P/E has been as high as 16.95 and as low as 9.85, with a median of 13.26.

Investors will also notice that GEF has 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 industry currently sports an average PEG of 1.47. 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. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GEF has a P/S ratio of 0.65. This compares to its industry's average P/S of 1.35.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Greif is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GEF feels like a great value stock at the moment.


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