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Should Value Investors Buy Quanex Building Products (NX) Stock?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Quanex Building Products (NX - Free Report) . NX is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 11.81, which compares to its industry's average of 13.72. Over the past year, NX's Forward P/E has been as high as 19.24 and as low as 10.40, with a median of 12.34.
Another valuation metric that we should highlight is NX's P/B ratio of 1.79. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. NX's current P/B looks attractive when compared to its industry's average P/B of 2.74. NX's P/B has been as high as 2.52 and as low as 1.69, with a median of 1.96, over the past year.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NX has a P/S ratio of 0.69. This compares to its industry's average P/S of 1.38.
Finally, investors will want to recognize that NX has a P/CF ratio of 7.42. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 17.37. Within the past 12 months, NX's P/CF has been as high as 10.23 and as low as 6.70, with a median of 7.94.
These are just a handful of the figures considered in Quanex Building Products'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 NX is an impressive value stock right now.
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Should Value Investors Buy Quanex Building Products (NX) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Quanex Building Products (NX - Free Report) . NX is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 11.81, which compares to its industry's average of 13.72. Over the past year, NX's Forward P/E has been as high as 19.24 and as low as 10.40, with a median of 12.34.
Another valuation metric that we should highlight is NX's P/B ratio of 1.79. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. NX's current P/B looks attractive when compared to its industry's average P/B of 2.74. NX's P/B has been as high as 2.52 and as low as 1.69, with a median of 1.96, over the past year.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NX has a P/S ratio of 0.69. This compares to its industry's average P/S of 1.38.
Finally, investors will want to recognize that NX has a P/CF ratio of 7.42. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 17.37. Within the past 12 months, NX's P/CF has been as high as 10.23 and as low as 6.70, with a median of 7.94.
These are just a handful of the figures considered in Quanex Building Products'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 NX is an impressive value stock right now.