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Should Value Investors Buy Frontline (FRO) Stock?

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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.

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 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 value investors might notice is Frontline (FRO - Free Report) . FRO is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.

FRO is also sporting a PEG ratio of 1.52. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. FRO's PEG compares to its industry's average PEG of 2.83. Over the last 12 months, FRO's PEG has been as high as 2.14 and as low as 1.17, with a median of 1.70.

Finally, we should also recognize that FRO has a P/CF ratio of 4.05. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 7.95. Over the past year, FRO's P/CF has been as high as 12.71 and as low as 3.69, with a median of 7.47.

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


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