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Is Greenbrier Companies (GBX) Stock Undervalued Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

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.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Greenbrier Companies (GBX - Free Report) . GBX is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 7.97, while its industry has an average P/E of 10.42. Over the last 12 months, GBX's Forward P/E has been as high as 15.76 and as low as 6.31, with a median of 8.81.

GBX is also sporting a PEG ratio of 0.84. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GBX's PEG compares to its industry's average PEG of 0.85. Within the past year, GBX's PEG has been as high as 1.66 and as low as 0.66, with a median of 0.93.

We should also highlight that GBX has a P/B ratio of 0.62. 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 attractive against its industry's average P/B of 1.09. GBX's P/B has been as high as 1.50 and as low as 0.49, with a median of 0.81, over the past year.

Finally, we should also recognize that GBX has a P/CF ratio of 5.59. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.67. 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 6.15.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Greenbrier Companies is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GBX feels like a great value stock at the moment.


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