Are Investors Undervaluing Murphy Oil (MUR) 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Murphy Oil (MUR) is a stock many investors are watching right now. MUR is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 12.25, which compares to its industry's average of 12.67. MUR's Forward P/E has been as high as 102.39 and as low as 6.95, with a median of 16.75, all within the past year.

Investors should also recognize that MUR has a P/B ratio of 0.79. 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 stock's P/B looks attractive against its industry's average P/B of 1.82. Over the past year, MUR's P/B has been as high as 1.30 and as low as 0.78, with a median of 1.09.

Finally, we should also recognize that MUR has a P/CF ratio of 3.29. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 5.07. Over the past 52 weeks, MUR's P/CF has been as high as 7.51 and as low as 2.86, with a median of 5.09.

Value investors will likely look at more than just these metrics, but the above data helps show that Murphy Oil is likely undervalued currently. And when considering the strength of its earnings outlook, MUR sticks out at as one of the market's strongest value stocks.

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