Back to top

Image: Bigstock

Are Investors Undervaluing American Woodmark (AMWD) Right Now?

Read MoreHide Full Article

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.

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.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company value investors might notice is American Woodmark (AMWD - Free Report) . AMWD is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 11.48, while its industry has an average P/E of 13.14. Over the last 12 months, AMWD's Forward P/E has been as high as 12.89 and as low as 7.01, with a median of 10.35.

Another notable valuation metric for AMWD is its P/B ratio of 2.27. 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 stock's P/B looks solid versus its industry's average P/B of 3.41. Over the past year, AMWD's P/B has been as high as 2.52 and as low as 1.51, with a median of 2.14.

Finally, our model also underscores that AMWD has a P/CF ratio of 7.81. 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 11.68. AMWD's P/CF has been as high as 11.44 and as low as 6.40, with a median of 7.86, all within the past year.

These are only a few of the key metrics included in American Woodmark'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, AMWD looks like an impressive value stock at the moment.

In-Depth Zacks Research for the Tickers Above

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

American Woodmark Corporation (AMWD) - free report >>

Published in