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Zacks

Is Jabil (JBL) Stock Undervalued Right Now?

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.

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.

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 company value investors might notice is Jabil (JBL). JBL is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 9.26 right now. For comparison, its industry sports an average P/E of 17.55. Over the past 52 weeks, JBL's Forward P/E has been as high as 13.65 and as low as 5.04, with a median of 9.22.

We also note that JBL holds a PEG ratio of 0.77. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. JBL's industry currently sports an average PEG of 1.40. Over the last 12 months, JBL's PEG has been as high as 1.14 and as low as 0.42, with a median of 0.77.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. JBL has a P/S ratio of 0.24. This compares to its industry's average P/S of 0.33.

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


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