Back to top

Are Investors Undervaluing Colfax (CFX) Right Now?

Read MoreHide Full Article

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.

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 Colfax (CFX - Free Report) . CFX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 8.21 right now. For comparison, its industry sports an average P/E of 16.27. Over the last 12 months, CFX's Forward P/E has been as high as 19.74 and as low as 7.24, with a median of 14.20.

Investors will also notice that CFX has a PEG ratio of 0.58. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CFX's industry has an average PEG of 1.30 right now. Within the past year, CFX's PEG has been as high as 1.96 and as low as 0.51, with a median of 1.11.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CFX has a P/S ratio of 0.72. This compares to its industry's average P/S of 1.45.

Finally, our model also underscores that CFX has a P/CF ratio of 6. 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 14.24. CFX's P/CF has been as high as 11.10 and as low as 5.26, with a median of 8.64, all within the past year.

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




In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Colfax Corporation (CFX) - free report >>

More from Zacks Tale of the Tape

You May Like

Published in