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 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.
Grifols (GRFS) is a stock many investors are watching right now. GRFS is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.
Another notable valuation metric for GRFS is its P/B ratio of 0.84. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. GRFS's current P/B looks attractive when compared to its industry's average P/B of 1.52. Within the past 52 weeks, GRFS's P/B has been as high as 0.86 and as low as 0.49, with a median of 0.64.
Finally, our model also underscores that GRFS has a P/CF ratio of 11.30. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 12.84. Within the past 12 months, GRFS's P/CF has been as high as 13.04 and as low as 9.04, with a median of 11.02.
These are only a few of the key metrics included in Grifols'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, GRFS looks like an impressive value stock at the moment.
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Grifols, S.A. (GRFS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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