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Should Value Investors Buy Trinity Industries (TRN) Stock?

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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.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Trinity Industries (TRN - Free Report) . TRN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.

Investors should also recognize that TRN has a P/B ratio of 0.87. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.29. Within the past 52 weeks, TRN's P/B has been as high as 1.21 and as low as 0.74, with a median of 1.03.

Finally, investors should note that TRN has a P/CF ratio of 4.96. 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 stock's P/CF looks attractive against its industry's average P/CF of 7.60. Within the past 12 months, TRN's P/CF has been as high as 8.05 and as low as 4.25, with a median of 6.72.

These are only a few of the key metrics included in Trinity Industries'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, TRN looks like an impressive value stock at the moment.


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