Is Galp Energia (GLPEY) Stock Undervalued Right Now?

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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Galp Energia (GLPEY). GLPEY is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 12.34, which compares to its industry's average of 13.47. Over the past 52 weeks, GLPEY's Forward P/E has been as high as 15.65 and as low as 10.65, with a median of 13.23.

Investors should also recognize that GLPEY has a P/B ratio of 2.21. 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 2.41. Over the past 12 months, GLPEY's P/B has been as high as 2.49 and as low as 1.66, with a median of 2.17.

Finally, investors will want to recognize that GLPEY has a P/CF ratio of 6.50. 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. GLPEY's current P/CF looks attractive when compared to its industry's average P/CF of 7.66. GLPEY's P/CF has been as high as 7.00 and as low as 5.03, with a median of 6.27, all within the past year.

These are only a few of the key metrics included in Galp Energia'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, GLPEY looks like an impressive value stock at the moment.

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This article originally published on Zacks Investment Research (zacks.com).

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