Back to top

Image: Bigstock

Should Value Investors Buy Greenbrier Companies (GBX) Stock?

Read MoreHide Full Article

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.

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 to watch right now is Greenbrier Companies (GBX - Free Report) . GBX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 8.76, which compares to its industry's average of 11.60. Over the past 52 weeks, GBX's Forward P/E has been as high as 15.76 and as low as 6.31, with a median of 8.92.

GBX is also sporting a PEG ratio of 0.92. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. GBX's industry has an average PEG of 0.94 right now. Within the past year, GBX's PEG has been as high as 1.66 and as low as 0.66, with a median of 0.94.

Investors should also recognize that GBX has a P/B ratio of 0.68. 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 1.21. Within the past 52 weeks, GBX's P/B has been as high as 1.50 and as low as 0.49, with a median of 0.85.

Finally, we should also recognize that GBX has a P/CF ratio of 6.14. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 7.39. Within the past 12 months, GBX's P/CF has been as high as 9.23 and as low as 4.42, with a median of 6.22.

These are just a handful of the figures considered in Greenbrier Companies's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that GBX is an impressive value stock right now.


See More Zacks Research for These Tickers


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


Greenbrier Companies, Inc. (The) (GBX) - free report >>

Published in