Are Investors Undervaluing Reynolds Consumer Products (REYN) 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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

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 Reynolds Consumer Products (REYN Quick QuoteREYN – Free Report) . REYN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We should also highlight that REYN has a P/B ratio of 2.78. 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 attractive against its industry’s average P/B of 6.42. Over the past year, REYN’s P/B has been as high as 3.35 and as low as 2.74, with a median of 3.

Finally, investors will want to recognize that REYN has a P/CF ratio of 11.55. 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. REYN’s P/CF compares to its industry’s average P/CF of 37.79. Over the past 52 weeks, REYN’s P/CF has been as high as 14.72 and as low as 11.40, with a median of 13.12.

Value investors will likely look at more than just these metrics, but the above data helps show that Reynolds Consumer Products is likely undervalued currently. And when considering the strength of its earnings outlook, REYN sticks out at as one of the market’s strongest value stocks.