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Are Investors Undervaluing Phibro Animal Health (PAHC) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Phibro Animal Health (PAHC - Free Report) is a stock many investors are watching right now. PAHC is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 15.37. This compares to its industry's average Forward P/E of 20.95. Over the last 12 months, PAHC's Forward P/E has been as high as 16.56 and as low as 7.98, with a median of 12.28.

Investors will also notice that PAHC has a PEG ratio of 1.20. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PAHC's industry currently sports an average PEG of 1.93. Over the past 52 weeks, PAHC's PEG has been as high as 1.74 and as low as 0.30, with a median of 0.50.

Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by 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. PAHC has a P/S ratio of 1.3. This compares to its industry's average P/S of 1.53.

These are only a few of the key metrics included in Phibro Animal Health'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, PAHC looks like an impressive value stock at the moment.


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