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Should Value Investors Buy Chemung Financial Corp (CHMG) Stock?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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 company value investors might notice is Chemung Financial Corp (CHMG - Free Report) . CHMG 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 9.10, while its industry has an average P/E of 11.14. CHMG's Forward P/E has been as high as 10.14 and as low as 7.62, with a median of 8.92, all within the past year.

Another valuation metric that we should highlight is CHMG's P/B ratio of 1.11. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. CHMG's current P/B looks attractive when compared to its industry's average P/B of 1.96. Over the past 12 months, CHMG's P/B has been as high as 1.39 and as low as 0.95, with a median of 1.10.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. CHMG has a P/S ratio of 1.5. This compares to its industry's average P/S of 2.01.

Finally, investors will want to recognize that CHMG has a P/CF ratio of 8.04. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. CHMG's P/CF compares to its industry's average P/CF of 17.08. CHMG's P/CF has been as high as 8.63 and as low as 5.43, with a median of 7.07, all within the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Chemung Financial Corp is likely undervalued currently. And when considering the strength of its earnings outlook, CHMG sticks out at as one of the market's strongest value stocks.


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