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Is Cosan (CZZ) a Great Value Stock Right Now?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Cosan . CZZ is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 11.32 right now. For comparison, its industry sports an average P/E of 12.75. Over the past year, CZZ's Forward P/E has been as high as 11.68 and as low as 2.82, with a median of 4.94.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CZZ has a P/S ratio of 0.43. This compares to its industry's average P/S of 0.46.

Finally, we should also recognize that CZZ has a P/CF ratio of 2.47. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. CZZ's current P/CF looks attractive when compared to its industry's average P/CF of 8.13. Within the past 12 months, CZZ's P/CF has been as high as 4.14 and as low as 1.81, with a median of 2.90.

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

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