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Should Value Investors Buy Patria Investments Limited (PAX) 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, 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.

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 to watch right now is Patria Investments Limited (PAX - Free Report) . PAX is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 10.79, which compares to its industry's average of 15.20. PAX's Forward P/E has been as high as 11.39 and as low as 7.42, with a median of 8.53, all within the past year.

We also note that PAX holds a PEG ratio of 0.73. 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. PAX's PEG compares to its industry's average PEG of 1.00. PAX's PEG has been as high as 1.66 and as low as 0.55, with a median of 0.70, all within the past year.

Another notable valuation metric for PAX is its P/B ratio of 1.63. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.71. Over the past 12 months, PAX's P/B has been as high as 1.66 and as low as 1.06, with a median of 1.45.

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. PAX has a P/S ratio of 2.43. This compares to its industry's average P/S of 3.58.

Finally, we should also recognize that PAX has a P/CF ratio of 18.91. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 38.54. Over the past 52 weeks, PAX's P/CF has been as high as 20.70 and as low as 13.43, with a median of 17.40.

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


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