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Are Investors Undervaluing Greif (GEF) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One company value investors might notice is Greif (GEF - Free Report) . GEF is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 10.04. This compares to its industry's average Forward P/E of 13.41. GEF's Forward P/E has been as high as 16.95 and as low as 8.84, with a median of 11.01, all within the past year.

GEF is also sporting a PEG ratio of 1. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GEF's PEG compares to its industry's average PEG of 1.32. Within the past year, GEF's PEG has been as high as 1.70 and as low as 0.88, with a median of 1.10.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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 0.53. This compares to its industry's average P/S of 1.16.

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


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