Should Value Investors Buy Beazer Homes USA (BZH) Stock?
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...
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 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.
Beazer Homes USA (BZH) is a stock many investors are watching right now. BZH is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 4.32. This compares to its industry's average Forward P/E of 7.14. Over the past 52 weeks, BZH's Forward P/E has been as high as 10.12 and as low as 3.88, with a median of 6.24.
Another notable valuation metric for BZH is its P/B ratio of 0.95. 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 solid versus its industry's average P/B of 1.58. Over the past year, BZH's P/B has been as high as 1.25 and as low as 0.73, with a median of 0.90.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BZH has a P/S ratio of 0.31. This compares to its industry's average P/S of 0.75.
Finally, investors should note that BZH has a P/CF ratio of 4.97. 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. BZH's current P/CF looks attractive when compared to its industry's average P/CF of 8.77. BZH's P/CF has been as high as 8.53 and as low as 3.85, with a median of 6.02, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Beazer Homes USA is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BZH feels like a great value stock at the moment.
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Beazer Homes USA, Inc. (BZH): Free Stock Analysis Report
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