Should Value Investors Buy Itron (ITRI) Stock?

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 Itron (ITRI). ITRI is currently sporting a Zacks Rank #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 19.59. This compares to its industry's average Forward P/E of 26.03. Over the last 12 months, ITRI's Forward P/E has been as high as 25.88 and as low as 16.50, with a median of 21.46.

Another valuation metric that we should highlight is ITRI's P/B ratio of 3.37. 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. ITRI's current P/B looks attractive when compared to its industry's average P/B of 4.54. Within the past 52 weeks, ITRI's P/B has been as high as 4.10 and as low as 2.78, with a median of 3.47.

Finally, investors should note that ITRI has a P/CF ratio of 16.89. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. ITRI's current P/CF looks attractive when compared to its industry's average P/CF of 27.95. Over the past 52 weeks, ITRI's P/CF has been as high as 20.38 and as low as 13.50, with a median of 16.93.

These are only a few of the key metrics included in Itron'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, ITRI 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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