Is Southwest Gas (SWX) Stock Undervalued Right Now?

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.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 to watch right now is Southwest Gas (SWX). SWX is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.Investors should also note that SWX holds a PEG ratio of 1.92. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SWX's PEG compares to its industry's average PEG of 2.11. SWX's PEG has been as high as 3.56 and as low as 1.84, with a median of 3.22, all within the past year.Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. SWX has a P/S ratio of 1.07. This compares to its industry's average P/S of 1.6.Finally, our model also underscores that SWX has a P/CF ratio of 7.70. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 8.51. Within the past 12 months, SWX's P/CF has been as high as 9.28 and as low as 7.17, with a median of 8.38.Another great Utility - Gas Distribution stock you could consider is UGI (UGI), which is a # 2 (Buy) stock with a Value Score of A.Shares of UGI are currently trading at a forward earnings multiple of 11.54 and a PEG ratio of 2.22 compared to its industry's P/E and PEG ratios of 15.13 and 2.11, respectively.Over the last 12 months, UGI's P/E has been as high as 11.62, as low as 7.23, with a median of 9.11, and its PEG ratio has been as high as 2.33, as low as 1.89, with a median of 2.17.Additionally, UGI has a P/B ratio of 1.54 while its industry's price-to-book ratio sits at 1.18. For UGI, this valuation metric has been as high as 1.60, as low as 0.99, with a median of 1.32 over the past year.These figures are just a handful of the metrics value investors tend to look at, but they help show that Southwest Gas and UGI are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SWX and UGI feels like a great value stock at the moment.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Southwest Gas Corporation (SWX): Free Stock Analysis Report UGI Corporation (UGI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks