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Are These Retail-Wholesale Stocks Undervalued Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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 company to watch right now is Companhia Brasileira de Distribuicao . CBD is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 13.10, which compares to its industry's average of 20.44. CBD's Forward P/E has been as high as 30.84 and as low as 7.05, with a median of 21.11, all within the past year.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CBD has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.27.

Tesco (TSCDY - Free Report) may be another strong Retail - Supermarkets stock to add to your shortlist. TSCDY is a # 2 (Buy) stock with a Value grade of A.

Tesco is currently trading with a Forward P/E ratio of 12.36 while its PEG ratio sits at 0.46. Both of the company's metrics compare favorably to its industry's average P/E of 20.44 and average PEG ratio of 2.51.

TSCDY's Forward P/E has been as high as 18.18 and as low as 9.73, with a median of 12.43. During the same time period, its PEG ratio has been as high as 2.94, as low as 0.45, with a median of 1.67.

Additionally, Tesco has a P/B ratio of 1.59 while its industry's price-to-book ratio sits at 3.84. For TSCDY, this valuation metric has been as high as 1.97, as low as 1.43, with a median of 1.57 over the past year.

These are just a handful of the figures considered in Companhia Brasileira de Distribuicao and Tesco's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that CBD and TSCDY is an impressive value stock right now.


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