Should Value Investors Buy Betterware de Mexico SAPI de C (BWMX) Stock?

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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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.

Betterware de Mexico SAPI de C (BWMX) is a stock many investors are watching right now. BWMX is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 6.25 right now. For comparison, its industry sports an average P/E of 17.18. Over the past year, BWMX's Forward P/E has been as high as 7.96 and as low as 4.45, with a median of 6.47.

Another valuation metric that we should highlight is BWMX's P/B ratio of 8.26. 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. This company's current P/B looks solid when compared to its industry's average P/B of 18.80. Over the past 12 months, BWMX's P/B has been as high as 8.61 and as low as 5.33, with a median of 6.89.

Finally, our model also underscores that BWMX has a P/CF ratio of 10.17. 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 stock's P/CF looks attractive against its industry's average P/CF of 16.41. Over the past 52 weeks, BWMX's P/CF has been as high as 10.59 and as low as 5.27, with a median of 6.88.

These are only a few of the key metrics included in Betterware de Mexico SAPI de C'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, BWMX looks like an impressive value stock at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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