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Should Value Investors Buy Salzgitter (SZGPY) 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.

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Salzgitter (SZGPY - Free Report) . SZGPY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Another valuation metric that we should highlight is SZGPY's P/B ratio of 0.46. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. SZGPY's current P/B looks attractive when compared to its industry's average P/B of 0.92. SZGPY's P/B has been as high as 0.70 and as low as 0.20, with a median of 0.32, over the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. SZGPY has a P/S ratio of 0.17. This compares to its industry's average P/S of 0.37.

Finally, our model also underscores that SZGPY has a P/CF ratio of 1.25. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. SZGPY's current P/CF looks attractive when compared to its industry's average P/CF of 3.02. Over the past 52 weeks, SZGPY's P/CF has been as high as 2.16 and as low as 0.55, with a median of 0.90.

Investors could also keep in mind Usinas Siderurgicas de Minas Gerais (USNZY - Free Report) , an Steel - Producers stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Shares of Usinas Siderurgicas de Minas Gerais currently holds a Forward P/E ratio of 9, and its PEG ratio is 0.75. In comparison, its industry sports average P/E and PEG ratios of 9.19 and 2.86.


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