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Should Value Investors Buy Usinas Siderurgicas de Minas Gerais (USNZY) 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company value investors might notice is Usinas Siderurgicas de Minas Gerais (USNZY - Free Report) . USNZY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. USNZY has a P/S ratio of 0.12. This compares to its industry's average P/S of 0.28.

Finally, investors will want to recognize that USNZY has a P/CF ratio of 1.60. 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. USNZY's current P/CF looks attractive when compared to its industry's average P/CF of 4.50. Within the past 12 months, USNZY's P/CF has been as high as 2.10 and as low as 1.10, with a median of 1.71.

Investors could also keep in mind Olympic Steel (ZEUS - Free Report) , an Steel - Producers stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.

Additionally, Olympic Steel has a P/B ratio of 1.04 while its industry's price-to-book ratio sits at 1.50. For ZEUS, this valuation metric has been as high as 1.27, as low as 0.50, with a median of 0.73 over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Usinas Siderurgicas de Minas Gerais and Olympic Steel are likely undervalued currently. And when considering the strength of its earnings outlook, USNZY and ZEUS sticks out as one of the market's strongest value stocks.


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