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Are Investors Undervaluing Constellium (CSTM) Right Now?

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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.

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.

Constellium (CSTM - Free Report) is a stock many investors are watching right now. CSTM is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CSTM has a P/S ratio of 0.21. This compares to its industry's average P/S of 0.36.

Finally, investors should note that CSTM has a P/CF ratio of 4.05. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. CSTM's current P/CF looks attractive when compared to its industry's average P/CF of 7.31. Over the past year, CSTM's P/CF has been as high as 7.07 and as low as 3.09, with a median of 4.62.

These are only a few of the key metrics included in Constellium'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, CSTM looks like an impressive value stock at the moment.


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