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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company value investors might notice is Copa Holdings (CPA). CPA is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 5.98 right now. For comparison, its industry sports an average P/E of 10.23. Over the last 12 months, CPA's Forward P/E has been as high as 6.76 and as low as 4.82, with a median of 5.79.
We also note that CPA holds a PEG ratio of 0.82. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CPA's PEG compares to its industry's average PEG of 0.87. Within the past year, CPA's PEG has been as high as 0.86 and as low as 0.19, with a median of 0.58.
We should also highlight that CPA has a P/B ratio of 1.71. 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 stock's P/B looks solid versus its industry's average P/B of 3.05. CPA's P/B has been as high as 2.11 and as low as 1.47, with a median of 1.69, over the past year.
Finally, investors will want to recognize that CPA has a P/CF ratio of 4.29. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 6.50. Over the past 52 weeks, CPA's P/CF has been as high as 5.26 and as low as 3.46, with a median of 4.08.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Copa Holdings is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CPA feels like a great value stock at the moment.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Copa Holdings, S.A. (CPA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
