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Should Value Investors Buy Fomento Economico Mexicano (FMX) Stock?
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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.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Fomento Economico Mexicano (FMX - Free Report) is a stock many investors are watching right now. FMX is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 14.93, while its industry has an average P/E of 19.96. Over the past year, FMX's Forward P/E has been as high as 24.90 and as low as 13.84, with a median of 19.71.
Investors will also notice that FMX has a PEG ratio of 1.31. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FMX's PEG compares to its industry's average PEG of 2.50. FMX's PEG has been as high as 2.18 and as low as 1.21, with a median of 1.43, all within the past year.
Another notable valuation metric for FMX is its P/B ratio of 3.76. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 8.88. Over the past year, FMX's P/B has been as high as 3.98 and as low as 1.47, with a median of 1.74.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. FMX has a P/S ratio of 0.76. This compares to its industry's average P/S of 1.64.
Finally, our model also underscores that FMX has a P/CF ratio of 8.07. 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. FMX's P/CF compares to its industry's average P/CF of 21.01. FMX's P/CF has been as high as 11.96 and as low as 7.13, with a median of 8.53, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Fomento Economico Mexicano is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FMX feels like a great value stock at the moment.
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Should Value Investors Buy Fomento Economico Mexicano (FMX) Stock?
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.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Fomento Economico Mexicano (FMX - Free Report) is a stock many investors are watching right now. FMX is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 14.93, while its industry has an average P/E of 19.96. Over the past year, FMX's Forward P/E has been as high as 24.90 and as low as 13.84, with a median of 19.71.
Investors will also notice that FMX has a PEG ratio of 1.31. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FMX's PEG compares to its industry's average PEG of 2.50. FMX's PEG has been as high as 2.18 and as low as 1.21, with a median of 1.43, all within the past year.
Another notable valuation metric for FMX is its P/B ratio of 3.76. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 8.88. Over the past year, FMX's P/B has been as high as 3.98 and as low as 1.47, with a median of 1.74.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. FMX has a P/S ratio of 0.76. This compares to its industry's average P/S of 1.64.
Finally, our model also underscores that FMX has a P/CF ratio of 8.07. 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. FMX's P/CF compares to its industry's average P/CF of 21.01. FMX's P/CF has been as high as 11.96 and as low as 7.13, with a median of 8.53, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Fomento Economico Mexicano is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FMX feels like a great value stock at the moment.