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Should Value Investors Buy Campbell Soup (CPB) Stock?

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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, 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Campbell Soup (CPB - Free Report) is a stock many investors are watching right now. CPB is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 18.23. This compares to its industry's average Forward P/E of 19.18. CPB's Forward P/E has been as high as 20.32 and as low as 14.15, with a median of 18.17, all within the past year.

Investors will also notice that CPB has a PEG ratio of 2.55. 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. CPB's industry has an average PEG of 2.61 right now. Over the last 12 months, CPB's PEG has been as high as 3.53 and as low as 2.36, with a median of 3.09.

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


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