Should Value Investors Buy ArcelorMittal (MT) Stock?
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, 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.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is ArcelorMittal (MT). MT is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 3.39, while its industry has an average P/E of 4.93. Over the past 52 weeks, MT's Forward P/E has been as high as 68.24 and as low as 3.21, with a median of 5.70.
Investors should also recognize that MT has a P/B ratio of 0.75. 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 attractive against its industry's average P/B of 2.02. Over the past 12 months, MT's P/B has been as high as 0.82 and as low as 0.33, with a median of 0.62.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. MT has a P/S ratio of 0.54. This compares to its industry's average P/S of 0.55.
Finally, our model also underscores that MT has a P/CF ratio of 4.04. 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. MT's current P/CF looks attractive when compared to its industry's average P/CF of 11.91. Over the past 52 weeks, MT's P/CF has been as high as 15.68 and as low as -12.35, with a median of 4.27.
These are only a few of the key metrics included in ArcelorMittal'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, MT looks like an impressive value stock at the moment.
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