Back to top

Image: Bigstock

Is Yara International ASA (YARIY) a Great Value Stock Right Now?

Read MoreHide Full Article

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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Yara International ASA (YARIY - Free Report) is a stock many investors are watching right now. YARIY is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 10.48, which compares to its industry's average of 12.62. Over the past 52 weeks, YARIY's Forward P/E has been as high as 13.77 and as low as 9.27, with a median of 11.02.

Investors should also recognize that YARIY has a P/B ratio of 1.15. 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 2.38. Over the past year, YARIY's P/B has been as high as 1.36 and as low as 0.87, with a median of 1.08.

Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. YARIY has a P/S ratio of 0.73. This compares to its industry's average P/S of 1.17.

Finally, our model also underscores that YARIY has a P/CF ratio of 5.28. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.49. Over the past 52 weeks, YARIY's P/CF has been as high as 7.77 and as low as 4.21, with a median of 5.60.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Yara International ASA is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, YARIY feels like a great value stock at the moment.

Published in