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Is Gray Television (GTN) Stock Undervalued Right Now?

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

One company value investors might notice is Gray Television (GTN). GTN 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 4.43. This compares to its industry's average Forward P/E of 12.53. Over the last 12 months, GTN's Forward P/E has been as high as 16.41 and as low as 4.24, with a median of 6.79.

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Investors should also note that GTN holds a PEG ratio of 0.44. 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. GTN's industry currently sports an average PEG of 1.14. Within the past year, GTN's PEG has been as high as 1.64 and as low as 0.42, with a median of 0.68.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GTN has a P/S ratio of 0.71. This compares to its industry's average P/S of 0.73.

Finally, our model also underscores that GTN has a P/CF ratio of 4.38. 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. GTN's current P/CF looks attractive when compared to its industry's average P/CF of 10.19. GTN's P/CF has been as high as 6.24 and as low as 2.78, with a median of 3.87, all within the past year.

Another great Broadcast Radio and Television stock you could consider is Nexstar Media Group (NXST), which is a # 1 (Strong Buy) stock with a Value Score of A.

Nexstar Media Group is currently trading with a Forward P/E ratio of 7.21 while its PEG ratio sits at 0.72. Both of the company's metrics compare favorably to its industry's average P/E of 12.53 and average PEG ratio of 1.14.

NXST's price-to-earnings ratio has been as high as 8.69 and as low as 5.60, with a median of 7.08, while its PEG ratio has been as high as 0.87 and as low as 0.56, with a median of 0.71, all within the past year.

Furthermore, Nexstar Media Group holds a P/B ratio of 2.39 and its industry's price-to-book ratio is 8.72. NXST's P/B has been as high as 2.72, as low as 2.11, with a median of 2.42 over the past 12 months.

Value investors will likely look at more than just these metrics, but the above data helps show that Gray Television and Nexstar Media Group are likely undervalued currently. And when considering the strength of its earnings outlook, GTN and NXST sticks out as one of the market's strongest value stocks.


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