Is Ternium S.A. (TX) a Great Value Stock 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. Neverthe...
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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Ternium S.A. (TX). TX is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 4.59, which compares to its industry's average of 4.87. Over the past year, TX's Forward P/E has been as high as 13.19 and as low as 3.40, with a median of 5.73.
Investors should also note that TX holds a PEG ratio of 0.26. 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. TX's industry has an average PEG of 0.33 right now. TX's PEG has been as high as 1.65 and as low as 0.24, with a median of 0.70, all within the past year.
Investors should also recognize that TX has a P/B ratio of 1.07. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. TX's current P/B looks attractive when compared to its industry's average P/B of 1.96. TX's P/B has been as high as 1.13 and as low as 0.44, with a median of 0.76, over the past year.
Finally, investors will want to recognize that TX has a P/CF ratio of 3.51. 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. TX's P/CF compares to its industry's average P/CF of 11.60. Over the past year, TX's P/CF has been as high as 6.78 and as low as 2.53, with a median of 4.09.
Value investors will likely look at more than just these metrics, but the above data helps show that Ternium S.A. Is likely undervalued currently. And when considering the strength of its earnings outlook, TX sticks out at as one of the market's strongest value stocks.
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Ternium S.A. (TX): Free Stock Analysis Report
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