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Is Cosan (CZZ) Stock Undervalued Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 stock to keep an eye on is Cosan . CZZ is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 12.93 right now. For comparison, its industry sports an average P/E of 17.31. 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 13.46.

Investors should also recognize that CZZ has a P/B ratio of 0.75. Investors use the P/B ratio to look at a stock's market value versus 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 1.32. Over the past year, CZZ's P/B has been as high as 0.84 and as low as 0.34, with a median of 0.54.

Finally, we should also recognize that CZZ has a P/CF ratio of 3.52. 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 3.63. Over the past year, CZZ's P/CF has been as high as 3.95 and as low as 1.81, with a median of 3.02.

These are only a few of the key metrics included in Cosan's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, CZZ looks like an impressive value stock at the moment.

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