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Is ConocoPhillips (COP) Stock Undervalued 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.

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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 stock to keep an eye on is ConocoPhillips (COP - Free Report) . COP 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 13.03. This compares to its industry's average Forward P/E of 14.34. Over the past 52 weeks, COP's Forward P/E has been as high as 21.94 and as low as 10.77, with a median of 15.70.

Investors will also notice that COP has a PEG ratio of 1.37. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. COP's industry has an average PEG of 1.83 right now. COP's PEG has been as high as 2.91 and as low as 1.20, with a median of 1.74, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. COP has a P/S ratio of 1.62. This compares to its industry's average P/S of 1.82.

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


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