Are Investors Undervaluing Warrior Met Coal (HCC) 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.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Warrior Met Coal (HCC). HCC is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

We should also highlight that HCC has a P/B ratio of 1.44. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.73. HCC's P/B has been as high as 2.52 and as low as 1.08, with a median of 1.42, over the past year.

Finally, investors will want to recognize that HCC has a P/CF ratio of 2.40. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 3.36. HCC's P/CF has been as high as 7.41 and as low as 1.81, with a median of 2.38, all within the past year.

These are just a handful of the figures considered in Warrior Met Coal'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 HCC is an impressive value stock right now.

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