Are Investors Undervaluing Companhia Brasileira de Distribuicao (CBD) Right Now?

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

Companhia Brasileira de Distribuicao (CBD) is a stock many investors are watching right now. CBD is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.63, which compares to its industry's average of 19.35. Over the past 52 weeks, CBD's Forward P/E has been as high as 29.28 and as low as 3.35, with a median of 11.93.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CBD has a P/S ratio of 0.11. This compares to its industry's average P/S of 0.3.

If you're looking for another solid Retail - Supermarkets value stock, take a look at The Kroger Co. (KR). KR is a # 2 (Buy) stock with a Value score of A.

The Kroger Co. is trading at a forward earnings multiple of 11.01 at the moment, with a PEG ratio of 0.94. This compares to its industry's average P/E of 19.35 and average PEG ratio of 2.86.

KR's price-to-earnings ratio has been as high as 16.61 and as low as 10.37, with a median of 12.93, while its PEG ratio has been as high as 1.98 and as low as 0.89, with a median of 1.42, all within the past year.

Additionally, The Kroger Co. has a P/B ratio of 3.39 while its industry's price-to-book ratio sits at 3.54. For KR, this valuation metric has been as high as 4.81, as low as 3.11, with a median of 3.61 over the past year.

These are only a few of the key metrics included in Companhia Brasileira de Distribuicao and The Kroger Co. strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, CBD and KR look like an impressive value stock at the moment.

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Companhia Brasileira de Distribuicao (CBD) : Free Stock Analysis Report
 
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