Should Value Investors Buy CNOOC (CEO) 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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One company to watch right now is CNOOC (CEO). CEO is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 15.05, while its industry has an average P/E of 17.52. Over the last 12 months, CEO's Forward P/E has been as high as 24.17 and as low as 6.91, with a median of 9.15.
CEO is also sporting a PEG ratio of 2.26. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CEO's PEG compares to its industry's average PEG of 2.48. Over the last 12 months, CEO's PEG has been as high as 3.64 and as low as 1.04, with a median of 1.78.
Another valuation metric that we should highlight is CEO's P/B ratio of 0.79. The P/B ratio pits a stock's market value against 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 1.62. Over the past 12 months, CEO's P/B has been as high as 1.25 and as low as 0.59, with a median of 1.05.
These are only a few of the key metrics included in CNOOC'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, CEO looks like an impressive 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.