Back to top

Image: Bigstock

Should Value Investors Buy Beazer Homes USA (BZH) Stock?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

Beazer Homes USA (BZH - Free Report) is a stock many investors are watching right now. BZH is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 4.26 right now. For comparison, its industry sports an average P/E of 9.99. Over the past year, BZH's Forward P/E has been as high as 4.42 and as low as 1.61, with a median of 2.79.

Another valuation metric that we should highlight is BZH's P/B ratio of 0.53. 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. BZH's current P/B looks attractive when compared to its industry's average P/B of 1.19. Within the past 52 weeks, BZH's P/B has been as high as 0.65 and as low as 0.32, with a median of 0.48.

Finally, our model also underscores that BZH has a P/CF ratio of 2.23. 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. BZH's current P/CF looks attractive when compared to its industry's average P/CF of 5.24. BZH's P/CF has been as high as 2.85 and as low as 1.27, with a median of 2.05, all within the past year.

These are just a handful of the figures considered in Beazer Homes USA's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that BZH is an impressive value stock right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Beazer Homes USA, Inc. (BZH) - free report >>

Published in