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Are Investors Undervaluing PG&E (PCG) Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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.

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 value investors might notice is PG&E (PCG - Free Report) . PCG is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 11.68. This compares to its industry's average Forward P/E of 12.37. Over the past 52 weeks, PCG's Forward P/E has been as high as 18.31 and as low as 10.01, with a median of 11.47.

We should also highlight that PCG has a P/B ratio of 1.25. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 1.42. PCG's P/B has been as high as 1.85 and as low as 1.01, with a median of 1.18, over the past year.

Finally, investors will want to recognize that PCG has a P/CF ratio of 7.75. 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 stock's P/CF looks attractive against its industry's average P/CF of 8.10. Over the past year, PCG's P/CF has been as high as 7.95 and as low as 4.35, with a median of 5.38.

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




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