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Is United States Steel (X) Stock Undervalued Right Now?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
United States Steel (X - Free Report) is a stock many investors are watching right now. X is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
Investors should also recognize that X has a P/B ratio of 0.54. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.41. Within the past 52 weeks, X's P/B has been as high as 1.14 and as low as 0.39, with a median of 0.58.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. X has a P/S ratio of 0.26. This compares to its industry's average P/S of 0.3.
Finally, investors will want to recognize that X has a P/CF ratio of 1.94. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. X's P/CF compares to its industry's average P/CF of 2.63. X's P/CF has been as high as 2.49 and as low as 0.85, with a median of 1.38, all within the past year.
These are only a few of the key metrics included in United States Steel'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, X looks like an impressive value stock at the moment.