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Is Plains GP Holdings (PAGP) 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.

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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Plains GP Holdings (PAGP - Free Report) . PAGP is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 11.63, which compares to its industry's average of 17.79. PAGP's Forward P/E has been as high as 17.04 and as low as 10.12, with a median of 14.07, all within the past year.

Finally, we should also recognize that PAGP has a P/CF ratio of 4.06. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.73. PAGP's P/CF has been as high as 4.74 and as low as -35.07, with a median of 3.67, 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 Plains GP Holdings is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PAGP feels like a great value stock at the moment.


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