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Should Value Investors Buy Johnson Matthey (JMPLY) Stock?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Johnson Matthey (JMPLY - Free Report) is a stock many investors are watching right now. JMPLY is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 10.94, while its industry has an average P/E of 15.84. JMPLY's Forward P/E has been as high as 12.27 and as low as 7.32, with a median of 9.51, all within the past year.

Investors will also notice that JMPLY has a PEG ratio of 0.64. 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. JMPLY's PEG compares to its industry's average PEG of 1.91. Over the last 12 months, JMPLY's PEG has been as high as 0.67 and as low as 0.54, with a median of 0.61.

Another valuation metric that we should highlight is JMPLY's P/B ratio of 1.44. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. JMPLY's current P/B looks attractive when compared to its industry's average P/B of 2.49. Over the past 12 months, JMPLY's P/B has been as high as 1.67 and as low as 1.07, with a median of 1.37.

These are only a few of the key metrics included in Johnson Matthey's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, JMPLY looks like an impressive value stock at the moment.

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