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Is Warrior Met Coal (HCC) a Great Value Stock Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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 company value investors might notice is Warrior Met Coal (HCC - Free Report) . HCC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 4.51, while its industry has an average P/E of 8.27. Over the last 12 months, HCC's Forward P/E has been as high as 9.02 and as low as 3.24, with a median of 4.87.

Finally, we should also recognize that HCC has a P/CF ratio of 2.49. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 2.80. Within the past 12 months, HCC's P/CF has been as high as 3.31 and as low as 1.94, with a median of 2.51.

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


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