Should Value Investors Buy Pilgrim's Pride (PPC) Stock?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 stock to keep an eye on is Pilgrim's Pride (PPC). PPC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 9.23. This compares to its industry's average Forward P/E of 15.60. Over the past year, PPC's Forward P/E has been as high as 18.59 and as low as 8.96, with a median of 11.25.
Investors should also note that PPC holds a PEG ratio of 0.22. 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. PPC's PEG compares to its industry's average PEG of 0.56. PPC's PEG has been as high as 0.42 and as low as 0.22, with a median of 0.28, all within the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. PPC has a P/S ratio of 0.58. This compares to its industry's average P/S of 0.92.
Finally, investors should note that PPC has a P/CF ratio of 8.81. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. PPC's P/CF compares to its industry's average P/CF of 13.86. Within the past 12 months, PPC's P/CF has been as high as 14.59 and as low as 7.56, with a median of 9.53.
These are only a few of the key metrics included in Pilgrim's Pride'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, PPC looks like an impressive value stock at the moment.
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Pilgrim's Pride Corporation (PPC) : Free Stock Analysis Report