Yahoo Finance Should Value Investors Buy Global Payments (GPN) Stock?
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company to watch right now is Global Payments (GPN). GPN is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 7.83, while its industry has an average P/E of 21.75. Over the last 12 months, GPN's Forward P/E has been as high as 12.20 and as low as 7.46, with a median of 10.28.
Investors should also note that GPN holds a PEG ratio of 0.55. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GPN's PEG compares to its industry's average PEG of 1.32. Over the last 12 months, GPN's PEG has been as high as 0.83 and as low as 0.53, with a median of 0.71.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. GPN has a P/S ratio of 2.5. This compares to its industry's average P/S of 2.6.
Finally, our model also underscores that GPN has a P/CF ratio of 7.65. 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 17.51. Over the past 52 weeks, GPN's P/CF has been as high as 16.28 and as low as 7.27, with a median of 11.48.
These are only a few of the key metrics included in Global Payments's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, GPN looks like an impressive value stock at the moment.
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Global Payments Inc. (GPN) : Free Stock Analysis Report
