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Should Value Investors Buy Valero Energy (VLO) 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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 stock to keep an eye on is Valero Energy (VLO - Free Report) . VLO is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
VLO is also sporting a PEG ratio of 1.55. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. VLO's industry currently sports an average PEG of 2.35. VLO's PEG has been as high as 1.96 and as low as 0.80, with a median of 1.27, all within the past year.
Investors should also recognize that VLO has a P/B ratio of 1.78. 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. This stock's P/B looks solid versus its industry's average P/B of 2. Over the past 12 months, VLO's P/B has been as high as 2.08 and as low as 1.39, with a median of 1.59.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. 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 0.37. This compares to its industry's average P/S of 0.41.
Finally, investors should note that VLO has a P/CF ratio of 5.33. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.10. VLO's P/CF has been as high as 6.23 and as low as 2.37, with a median of 3.45, all within the past year.
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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Should Value Investors Buy Valero Energy (VLO) Stock?
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 stock to keep an eye on is Valero Energy (VLO - Free Report) . VLO is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
VLO is also sporting a PEG ratio of 1.55. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. VLO's industry currently sports an average PEG of 2.35. VLO's PEG has been as high as 1.96 and as low as 0.80, with a median of 1.27, all within the past year.
Investors should also recognize that VLO has a P/B ratio of 1.78. 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. This stock's P/B looks solid versus its industry's average P/B of 2. Over the past 12 months, VLO's P/B has been as high as 2.08 and as low as 1.39, with a median of 1.59.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. 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 0.37. This compares to its industry's average P/S of 0.41.
Finally, investors should note that VLO has a P/CF ratio of 5.33. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 6.10. VLO's P/CF has been as high as 6.23 and as low as 2.37, with a median of 3.45, all within the past year.
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.