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Are Investors Undervaluing Textainer Group (TGH) Right Now?

Zacks Equity Research
·2-min read

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Textainer Group (TGH). TGH is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 7.29 right now. For comparison, its industry sports an average P/E of 14.99. Over the last 12 months, TGH's Forward P/E has been as high as 10.75 and as low as 6.38, with a median of 8.37.

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Finally, we should also recognize that TGH has a P/CF ratio of 3.99. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. TGH's current P/CF looks attractive when compared to its industry's average P/CF of 4.93. Over the past year, TGH's P/CF has been as high as 4.32 and as low as 1.25, with a median of 2.30.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Textainer Group is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, TGH feels like a great value stock at the moment.


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Textainer Group Holdings Limited (TGH) : Free Stock Analysis Report
 
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