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Is Quanex Building Products (NX) Stock Undervalued Right Now?

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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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 company to watch right now is Quanex Building Products (NX - Free Report) . NX is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 13.04 right now. For comparison, its industry sports an average P/E of 17.20. Over the past 52 weeks, NX's Forward P/E has been as high as 15.27 and as low as 11.61, with a median of 13.10.

We also note that NX holds a PEG ratio of 0.93. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. NX's PEG compares to its industry's average PEG of 1.53. Within the past year, NX's PEG has been as high as 1.99 and as low as 0.88, with a median of 1.75.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NX has a P/S ratio of 1.04. This compares to its industry's average P/S of 1.6.

Finally, our model also underscores that NX has a P/CF ratio of 8.91. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 29.52. Within the past 12 months, NX's P/CF has been as high as 9.84 and as low as 5.48, with a median of 7.92.

These are only a few of the key metrics included in Quanex Building Products's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, NX looks like an impressive value stock at the moment.


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