Are Investors Undervaluing American Woodmark (AMWD) 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 company value investors might notice is American Woodmark (AMWD). AMWD is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.

We also note that AMWD holds a PEG ratio of 0.74. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AMWD's PEG compares to its industry's average PEG of 1.15. AMWD's PEG has been as high as 1.58 and as low as 0.51, with a median of 1.35, all within the past year.

Another valuation metric that we should highlight is AMWD's P/B ratio of 1.76. The P/B ratio pits a stock's market value against 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 4.09. Over the past year, AMWD's P/B has been as high as 2.88 and as low as 0.88, with a median of 2.27.

Finally, we should also recognize that AMWD has a P/CF ratio of 7.05. 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. AMWD's P/CF compares to its industry's average P/CF of 12.71. Over the past 52 weeks, AMWD's P/CF has been as high as 10.74 and as low as 3.31, with a median of 7.83.

These are just a handful of the figures considered in American Woodmark's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that AMWD is an impressive value stock right now.

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