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Should Value Investors Buy The Greenbrier Companies (GBX) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 company value investors might notice is The Greenbrier Companies (GBX - Free Report) . GBX is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 11.74. This compares to its industry's average Forward P/E of 15.01. Over the past year, GBX's Forward P/E has been as high as 15.66 and as low as 8.99, with a median of 12.23.

Another notable valuation metric for GBX is its P/B ratio of 1.09. 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 stock's P/B looks solid versus its industry's average P/B of 1.87. Over the past 12 months, GBX's P/B has been as high as 1.16 and as low as 0.61, with a median of 0.96.

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. GBX has a P/S ratio of 0.43. This compares to its industry's average P/S of 0.9.

Finally, investors will want to recognize that GBX has a P/CF ratio of 7.61. 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 9.04. Over the past year, GBX's P/CF has been as high as 9.76 and as low as 5.57, with a median of 7.48.

These are only a few of the key metrics included in The Greenbrier Companies'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, GBX looks like an impressive value stock at the moment.

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