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Is Compania Cervecerias Unidas (CCU) Stock Undervalued Right Now?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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.

One stock to keep an eye on is Compania Cervecerias Unidas (CCU - Free Report) . CCU is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 13.96, while its industry has an average P/E of 15.18. CCU's Forward P/E has been as high as 21.80 and as low as 12.44, with a median of 14.43, all within the past year.

CCU is also sporting a PEG ratio of 1.18. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CCU's industry has an average PEG of 1.67 right now. Over the last 12 months, CCU's PEG has been as high as 3.22 and as low as 0.99, with a median of 1.46.

Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CCU has a P/S ratio of 0.66. This compares to its industry's average P/S of 0.9.

These are only a few of the key metrics included in Compania Cervecerias Unidas'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, CCU looks like an impressive value stock at the moment.

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