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Is Jazz Pharmaceuticals (JAZZ) a Great Value Stock Right Now?

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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.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

Jazz Pharmaceuticals (JAZZ - Free Report) is a stock many investors are watching right now. JAZZ is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Investors will also notice that JAZZ has a PEG ratio of 1.12. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. JAZZ's industry currently sports an average PEG of 3.19. Over the past 52 weeks, JAZZ's PEG has been as high as 1.44 and as low as 0.64, with a median of 0.82.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. JAZZ has a P/S ratio of 1.76. This compares to its industry's average P/S of 3.17.

Finally, our model also underscores that JAZZ has a P/CF ratio of 5.86. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.57. Over the past year, JAZZ's P/CF has been as high as 48.11 and as low as 5.21, with a median of 8.16.

These are just a handful of the figures considered in Jazz Pharmaceuticals'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 JAZZ is an impressive value stock right now.


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