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Is Canadian Solar (CSIQ) a Great Value Stock 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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 stock to keep an eye on is Canadian Solar (CSIQ). CSIQ is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Investors should also recognize that CSIQ has a P/B ratio of 0.71. 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 attractive against its industry's average P/B of 2.05. Over the past 12 months, CSIQ's P/B has been as high as 1.10 and as low as 0.55, with a median of 0.88.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. CSIQ has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.97.

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


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