Are These Consumer Staples Stocks Undervalued Right Now?
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 to watch right now is MEDIFAST (MED). MED is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 12.51 right now. For comparison, its industry sports an average P/E of 19.39. Over the past 52 weeks, MED's Forward P/E has been as high as 25.20 and as low as 12.09, with a median of 18.88.
Finally, investors should note that MED has a P/CF ratio of 14.36. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 19.61. MED's P/CF has been as high as 29.61 and as low as 13.08, with a median of 20.18, all within the past year.
Investors could also keep in mind United Natural Foods (UNFI), an Food - Miscellaneous stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Additionally, United Natural Foods has a P/B ratio of 1.68 while its industry's price-to-book ratio sits at 2.30. For UNFI, this valuation metric has been as high as 2.03, as low as 1.08, with a median of 1.58 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that MEDIFAST and United Natural Foods are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MED and UNFI feels like a great value stock at the moment.
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MEDIFAST INC (MED) : Free Stock Analysis Report
United Natural Foods, Inc. (UNFI) : Free Stock Analysis Report
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