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Are Investors Undervaluing CompoSecure (CMPO) 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.

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.

One stock to keep an eye on is CompoSecure (CMPO - Free Report) . CMPO is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

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. CMPO has a P/S ratio of 1.45. This compares to its industry's average P/S of 2.79.

Finally, investors should note that CMPO has a P/CF ratio of 4.67. 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. CMPO's current P/CF looks attractive when compared to its industry's average P/CF of 18.25. Within the past 12 months, CMPO's P/CF has been as high as 25.25 and as low as 3.12, with a median of 7.23.

Another great Financial Transaction Services stock you could consider is WEX (WEX - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.

WEX is currently trading with a Forward P/E ratio of 12.93 while its PEG ratio sits at 1.13. Both of the company's metrics compare favorably to its industry's average P/E of 22.22 and average PEG ratio of 1.38.

WEX's price-to-earnings ratio has been as high as 14.49 and as low as 10.26, with a median of 12.25, while its PEG ratio has been as high as 1.79 and as low as 1, with a median of 1.22, all within the past year.

WEX sports a P/B ratio of 5.15 as well; this compares to its industry's price-to-book ratio of 7.39. In the past 52 weeks, WEX's P/B has been as high as 5.71, as low as 4.11, with a median of 4.68.

These are only a few of the key metrics included in CompoSecure and WEX strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, CMPO and WEX look like an impressive value stock at the moment.


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