Is Univar Solutions (UNVR) Stock Undervalued Right Now?
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Univar Solutions (UNVR) is a stock many investors are watching right now. UNVR is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 7.16, while its industry has an average P/E of 9.75. Over the past year, UNVR's Forward P/E has been as high as 15.66 and as low as 7.16, with a median of 11.98.
Investors should also note that UNVR holds a PEG ratio of 0.49. 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. UNVR's industry has an average PEG of 0.66 right now. Over the last 12 months, UNVR's PEG has been as high as 1.21 and as low as 0.49, with a median of 0.85.
Another notable valuation metric for UNVR is its P/B ratio of 1.46. 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. UNVR's current P/B looks attractive when compared to its industry's average P/B of 1.97. Over the past year, UNVR's P/B has been as high as 2.52 and as low as 1.46, with a median of 2.04.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. UNVR has a P/S ratio of 0.34. This compares to its industry's average P/S of 0.53.
Finally, investors should note that UNVR has a P/CF ratio of 4.91. 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. UNVR's current P/CF looks attractive when compared to its industry's average P/CF of 6.08. Within the past 12 months, UNVR's P/CF has been as high as 10.31 and as low as 4.91, with a median of 7.05.
These are only a few of the key metrics included in Univar Solutions'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, UNVR looks like an impressive value stock at the moment.
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