Should Value Investors Buy Nexa Resources S.A. (NEXA) Stock?

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.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system’s “Value” category. Stocks with both “A” grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

Nexa Resources S.A. (NEXA Free Report) is a stock many investors are watching right now. NEXA is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 4.21, while its industry has an average P/E of 7.53. NEXA’s Forward P/E has been as high as 2,510.48 and as low as -3,703.88, with a median of 9.10, all within the past year.

We should also highlight that NEXA has a P/B ratio of 0.58. Investors use the P/B ratio to look at a stock’s market value versus 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 1.07. Over the past year, NEXA’s P/B has been as high as 1 and as low as 0.43, with a median of 0.72.

These are only a few of the key metrics included in Nexa Resources S.A.’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, NEXA looks like an impressive value stock at the moment.

Read More

Zacks Equity Research