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Are Investors Undervaluing Cosan (CZZ) 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.

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.

Cosan is a stock many investors are watching right now. CZZ 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 13.13, which compares to its industry's average of 16.53. Over the past year, CZZ's Forward P/E has been as high as 19.16 and as low as 9.64, with a median of 13.90.

Investors should also note that CZZ holds a PEG ratio of 0.80. 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. CZZ's industry has an average PEG of 1.01 right now. Within the past year, CZZ's PEG has been as high as 0.81 and as low as 0.76, with a median of 0.79.

We should also highlight that CZZ has a P/B ratio of 0.98. The P/B ratio is used to compare a stock's market value with 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 1.33. CZZ's P/B has been as high as 0.98 and as low as 0.43, with a median of 0.68, over the past year.

Finally, we should also recognize that CZZ has a P/CF ratio of 4.26. 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 stock's P/CF looks attractive against its industry's average P/CF of 6.29. CZZ's P/CF has been as high as 4.26 and as low as 2.43, with a median of 3.28, all within the past year.

These are just a handful of the figures considered in Cosan'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 CZZ is an impressive value stock right now.

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