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Are Investors Undervaluing Celanese (CE) Right Now?

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Celanese (CE). CE is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 10.89, which compares to its industry's average of 12.89. CE's Forward P/E has been as high as 14.54 and as low as 10.71, with a median of 12.39, all within the past year.

We also note that CE holds a PEG ratio of 1.09. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CE's PEG compares to its industry's average PEG of 1.16. Over the last 12 months, CE's PEG has been as high as 1.71 and as low as 1.07, with a median of 1.43.

Finally, our model also underscores that CE has a P/CF ratio of 10.90. 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. CE's current P/CF looks attractive when compared to its industry's average P/CF of 17.38. CE's P/CF has been as high as 13.48 and as low as 9.99, with a median of 12.10, all within the past year.

These are just a handful of the figures considered in Celanese's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that CE is an impressive value stock right now.

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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.


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

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