Should Value Investors Buy Berry Global (BERY) Stock?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
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 value investors might notice is Berry Global (BERY). BERY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 9.83. This compares to its industry's average Forward P/E of 15.65. BERY's Forward P/E has been as high as 14.74 and as low as 6.19, with a median of 9.83, all within the past year.
Investors should also note that BERY holds a PEG ratio of 0.98. 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. BERY's industry currently sports an average PEG of 1.26. Over the last 12 months, BERY's PEG has been as high as 1.47 and as low as 0.50, with a median of 0.85.
We should also highlight that BERY has a P/B ratio of 3.54. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 6.79. Over the past 12 months, BERY's P/B has been as high as 4.70 and as low as 2, with a median of 3.38.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BERY has a P/S ratio of 0.56. This compares to its industry's average P/S of 0.99.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Berry Global is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BERY 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.