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Are Investors Undervaluing Valero Energy (VLO) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
One stock to keep an eye on is Valero Energy (VLO - Free Report) . VLO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Investors should also note that VLO holds a PEG ratio of 1.83. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. VLO's PEG compares to its industry's average PEG of 1.93. Over the last 12 months, VLO's PEG has been as high as 1.96 and as low as 0.80, with a median of 1.25.
Investors should also recognize that VLO has a P/B ratio of 2.06. Investors use the P/B ratio to look at a stock's market value versus 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 2.25. VLO's P/B has been as high as 2.14 and as low as 1.39, with a median of 1.58, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. VLO has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.46.
Finally, investors will want to recognize that VLO has a P/CF ratio of 5.19. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.16. Over the past 52 weeks, VLO's P/CF has been as high as 5.37 and as low as 2.37, with a median of 3.41.
These are just a handful of the figures considered in Valero Energy'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 VLO is an impressive value stock right now.
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Are Investors Undervaluing Valero Energy (VLO) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
One stock to keep an eye on is Valero Energy (VLO - Free Report) . VLO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.
Investors should also note that VLO holds a PEG ratio of 1.83. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. VLO's PEG compares to its industry's average PEG of 1.93. Over the last 12 months, VLO's PEG has been as high as 1.96 and as low as 0.80, with a median of 1.25.
Investors should also recognize that VLO has a P/B ratio of 2.06. Investors use the P/B ratio to look at a stock's market value versus 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 2.25. VLO's P/B has been as high as 2.14 and as low as 1.39, with a median of 1.58, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. VLO has a P/S ratio of 0.4. This compares to its industry's average P/S of 0.46.
Finally, investors will want to recognize that VLO has a P/CF ratio of 5.19. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.16. Over the past 52 weeks, VLO's P/CF has been as high as 5.37 and as low as 2.37, with a median of 3.41.
These are just a handful of the figures considered in Valero Energy'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 VLO is an impressive value stock right now.