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Is Installed Building Products (IBP) Stock Undervalued Right Now?
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.
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.
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.
Installed Building Products (IBP - Free Report) is a stock many investors are watching right now. IBP is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.23, which compares to its industry's average of 12.58. Over the past year, IBP's Forward P/E has been as high as 24.54 and as low as 9.53, with a median of 14.73.
Finally, investors will want to recognize that IBP has a P/CF ratio of 10.54. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. IBP's P/CF compares to its industry's average P/CF of 14.93. Over the past 52 weeks, IBP's P/CF has been as high as 18.81 and as low as 8.52, with a median of 13.50.
Value investors will likely look at more than just these metrics, but the above data helps show that Installed Building Products is likely undervalued currently. And when considering the strength of its earnings outlook, IBP sticks out at as one of the market's strongest value stocks.