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Is Cosan (CZZ) 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Cosan . CZZ is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 14.06 right now. For comparison, its industry sports an average P/E of 17.94. Over the last 12 months, CZZ's Forward P/E has been as high as 19.16 and as low as 2.82, with a median of 11.92.

Investors should also recognize that CZZ has a P/B ratio of 0.75. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.25. CZZ's P/B has been as high as 0.76 and as low as 0.34, with a median of 0.50, over the past year.

Finally, investors will want to recognize that CZZ has a P/CF ratio of 3.53. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. CZZ's current P/CF looks attractive when compared to its industry's average P/CF of 6.65. Within the past 12 months, CZZ's P/CF has been as high as 3.59 and as low as 1.81, with a median of 2.81.

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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