Is Mosaic (MOS) 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...
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
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.
Mosaic (MOS) is a stock many investors are watching right now. MOS is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 7.25, which compares to its industry's average of 12.72. Over the last 12 months, MOS's Forward P/E has been as high as 24.25 and as low as 6.99, with a median of 14.20.
Investors will also notice that MOS has a PEG ratio of 1.04. 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. MOS's PEG compares to its industry's average PEG of 1.06. Over the past 52 weeks, MOS's PEG has been as high as 3.46 and as low as 1, with a median of 2.03.
Another valuation metric that we should highlight is MOS's P/B ratio of 1.16. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.62. MOS's P/B has been as high as 1.46 and as low as 0.73, with a median of 1.11, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. MOS has a P/S ratio of 1.23. This compares to its industry's average P/S of 1.72.
Finally, we should also recognize that MOS has a P/CF ratio of 5.33. 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 stock's P/CF looks attractive against its industry's average P/CF of 12.24. Over the past year, MOS's P/CF has been as high as 19.85 and as low as 4.77, with a median of 7.07.
Value investors will likely look at more than just these metrics, but the above data helps show that Mosaic is likely undervalued currently. And when considering the strength of its earnings outlook, MOS sticks out at as one of the market's strongest value stocks.
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