3 Value Stocks with Magic PEG Ratios

Zacks Market Edge

Welcome to Episode #24 of the Value Investor Podcast Every week, Zacks value stock strategist and the Editor of Zacks Value Investor portfolio service, Tracey Ryniec, talks about all things happening in the value stock universe, including her top stock picks. It’s a new year and with that brings new investing opportunities. If you’re not investing, now is the time. Start small and build your portfolio from there. Tracey took a look at one of her favorite value screening criteria, the PEG ratio, to see just how much value is still in this market, which is trading near all-time highs. She looked for the “magic” PEG ratio, which is a PEG under 1.0. That usually indicates a company is undervalued. That gave her too many stocks so she added a Zacks Rank of #1 (Strong Buy) or #2 (Buy) to narrow it down. The Zacks Rank should also provide companies with rising earnings estimates. To her surprise, there were 47 companies that passed the screen. There’s more value and growth combinations than you might think on the stock market right now. Here are her 3 favorites. 3 Value Stocks with Magic PEG Ratios 1. The Chemours Company (CC), a specialty chemical company that was spun off from DuPont. It has a PEG of just 0.68 and is expected to grow earnings by 66% in 2017. 2. Freeport McMoran (FCX) is a copper mining giant which also has a large oil and gas business. The energy and mining companies haven’t shown up in Tracey’s value screens in a while. Even though shares soared 94% in 2016, it’s still cheap with a PEG ratio of just 0.36. It also has soaring earnings estimates for 2017. 3. Whirlpool (WHR), the global appliance maker, has been outperforming in the North American market but has struggled in its number 2 market of Brazil. Still, the shares are cheap with a PEG of just 0.7. Earnings are expected to grow 12.7% in 2017. Tracey believes this could be the year of the value stock. Are you game? Find out more about what Tracey thinks about the PEG ratio in this week’s podcast. Chemours Company: https://www.zacks.com/stock/quote/CC?cid=cs-soundcloud-ft-pod Freeport-McMoran: https://www.zacks.com/stock/quote/FCX?cid=cs-soundcloud-ft-pod Whirlpool: https://www.zacks.com/stock/quote/WHR?cid=cs-soundcloud-ft-pod Follow us on StockTwits: stocktwits.com/ZacksResearch Follow us on Twitter: twitter.com/ZacksResearch Like us on Facebook: www.facebook.com/ZacksInvestmentResearch