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Are Investors Undervaluing CPI Aerostructures (CVU) 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

One company value investors might notice is CPI Aerostructures (CVU - Free Report) . CVU is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 8.28. This compares to its industry's average Forward P/E of 14.98. Over the past year, CVU's Forward P/E has been as high as 14.90 and as low as 8.02, with a median of 10.84.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CVU has a P/S ratio of 0.89. This compares to its industry's average P/S of 1.34.

Finally, investors will want to recognize that CVU has a P/CF ratio of 8.24. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 13.57. Over the past 52 weeks, CVU's P/CF has been as high as 15.92 and as low as 8.01, with a median of 11.93.

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


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