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Should Value Investors Buy Greif (GEF) Stock?

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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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One stock to keep an eye on is Greif (GEF - Free Report) . GEF is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 9.99. This compares to its industry's average Forward P/E of 12.56. Over the past year, GEF's Forward P/E has been as high as 16.30 and as low as 8.84, with a median of 10.05.

GEF is also sporting a PEG ratio of 1. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. GEF's industry currently sports an average PEG of 1.11. Over the last 12 months, GEF's PEG has been as high as 1.63 and as low as 0.88, with a median of 1.01.

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. GEF has a P/S ratio of 0.47. This compares to its industry's average P/S of 1.04.

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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