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Should Value Investors Buy Greif (GEF) Stock?

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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Greif (GEF - Free Report) . GEF is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 13.59 right now. For comparison, its industry sports an average P/E of 14.16. Over the past 52 weeks, GEF's Forward P/E has been as high as 15.00 and as low as 11.05, with a median of 13.05.

We also note that GEF holds a PEG ratio of 1.38. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. GEF's industry has an average PEG of 2.67 right now. GEF's PEG has been as high as 1.66 and as low as 0.79, with a median of 1.04, all within the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GEF has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.93.

These are just a handful of the figures considered in Greif's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that GEF is an impressive value stock right now.


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