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Should Value Investors Buy Komatsu (KMTUY) Stock?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.

One stock to keep an eye on is Komatsu (KMTUY - Free Report) . KMTUY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 11.87, which compares to its industry's average of 15.59. KMTUY's Forward P/E has been as high as 11.87 and as low as 8.29, with a median of 10.07, all within the past year.

Finally, our model also underscores that KMTUY has a P/CF ratio of 6.70. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 12.19. Over the past 52 weeks, KMTUY's P/CF has been as high as 7.93 and as low as 4.72, with a median of 6.12.

These are only a few of the key metrics included in Komatsu'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, KMTUY looks like an impressive value stock at the moment.


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