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Should Value Investors Buy PriceSmart (PSMT) Stock?
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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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.
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 PriceSmart (PSMT - Free Report) . PSMT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 16.77, while its industry has an average P/E of 29.24. Over the last 12 months, PSMT's Forward P/E has been as high as 17.56 and as low as 15.25, with a median of 16.47.
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. PSMT has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.82.
Finally, we should also recognize that PSMT has a P/CF ratio of 12.83. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 28.62. Within the past 12 months, PSMT's P/CF has been as high as 13.49 and as low as 10.59, with a median of 12.38.
Value investors will likely look at more than just these metrics, but the above data helps show that PriceSmart is likely undervalued currently. And when considering the strength of its earnings outlook, PSMT sticks out at as one of the market's strongest value stocks.
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Should Value Investors Buy PriceSmart (PSMT) Stock?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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.
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 PriceSmart (PSMT - Free Report) . PSMT is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 16.77, while its industry has an average P/E of 29.24. Over the last 12 months, PSMT's Forward P/E has been as high as 17.56 and as low as 15.25, with a median of 16.47.
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. PSMT has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.82.
Finally, we should also recognize that PSMT has a P/CF ratio of 12.83. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 28.62. Within the past 12 months, PSMT's P/CF has been as high as 13.49 and as low as 10.59, with a median of 12.38.
Value investors will likely look at more than just these metrics, but the above data helps show that PriceSmart is likely undervalued currently. And when considering the strength of its earnings outlook, PSMT sticks out at as one of the market's strongest value stocks.