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Is Sunoco LP (SUN) a Great Value Stock Right Now?


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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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

Sunoco LP (SUN) is a stock many investors are watching right now. SUN is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 12.19, while its industry has an average P/E of 16.79. Over the past year, SUN's Forward P/E has been as high as 31.20 and as low as 9.85, with a median of 12.63.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's 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. SUN has a P/S ratio of 0.19. This compares to its industry's average P/S of 0.56.

Finally, investors will want to recognize that SUN has a P/CF ratio of 6.55. 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. SUN's current P/CF looks attractive when compared to its industry's average P/CF of 8.68. Over the past 52 weeks, SUN's P/CF has been as high as 7.95 and as low as -136.49, with a median of 6.46.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Sunoco LP is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SUN feels like a great value stock at the moment.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.





This article appears in: Investing , Investing Ideas , Stocks
Referenced Symbols: SUN



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