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Is Phibro Animal Health (PAHC) a Great Value Stock Right Now?

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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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Phibro Animal Health (PAHC - Free Report) . PAHC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 10.96 right now. For comparison, its industry sports an average P/E of 21.53. Over the past year, PAHC's Forward P/E has been as high as 12.14 and as low as 8.01, with a median of 10.28.

Finally, investors should note that PAHC has a P/CF ratio of 10.32. 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. PAHC's P/CF compares to its industry's average P/CF of 35.54. Over the past year, PAHC's P/CF has been as high as 10.67 and as low as 6.93, with a median of 8.79.

Value investors will likely look at more than just these metrics, but the above data helps show that Phibro Animal Health is likely undervalued currently. And when considering the strength of its earnings outlook, PAHC sticks out at as one of the market's strongest value stocks.


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