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Is Adecoagro (AGRO) 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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 company to watch right now is Adecoagro (AGRO - Free Report) . AGRO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.58, which compares to its industry's average of 19.84. AGRO's Forward P/E has been as high as 29.54 and as low as 8.17, with a median of 12.64, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. AGRO has a P/S ratio of 1.13. This compares to its industry's average P/S of 1.16.

Value investors will likely look at more than just these metrics, but the above data helps show that Adecoagro is likely undervalued currently. And when considering the strength of its earnings outlook, AGRO sticks out at as one of the market's strongest value stocks.


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