Yahoo Finance Should Value Investors Buy Pampa Energia (PAM) Stock?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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.
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 to watch right now is Pampa Energia (PAM). PAM is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 5.76, while its industry has an average P/E of 13.80. Over the past 52 weeks, PAM's Forward P/E has been as high as 13.63 and as low as 4.02, with a median of 5.70.
Another notable valuation metric for PAM is its P/B ratio of 0.80. The P/B ratio is used to compare a stock's market value with 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 2.06. Within the past 52 weeks, PAM's P/B has been as high as 0.87 and as low as 0.51, with a median of 0.66.
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. PAM has a P/S ratio of 1.15. This compares to its industry's average P/S of 1.86.
Finally, investors will want to recognize that PAM has a P/CF ratio of 2.94. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 11.66. PAM's P/CF has been as high as 3.02 and as low as 1.97, with a median of 2.53, all within the past year.
Another great Utility - Electric Power stock you could consider is TransAlta (TAC), which is a # 1 (Strong Buy) stock with a Value Score of A.
TransAlta also has a P/B ratio of 2.70 compared to its industry's price-to-book ratio of 2.06. Over the past year, its P/B ratio has been as high as 3.24, as low as 1.87, with a median of 2.45.
Value investors will likely look at more than just these metrics, but the above data helps show that Pampa Energia and TransAlta are likely undervalued currently. And when considering the strength of its earnings outlook, PAM and TAC sticks out as one of the market's strongest value stocks.
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Pampa Energia S.A. (PAM) : Free Stock Analysis Report
TransAlta Corporation (TAC) : Free Stock Analysis Report
