Should Value Investors Buy XP (XP) Stock?

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.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.One stock to keep an eye on is XP (XP). XP 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 8.39, while its industry has an average P/E of 14.69. XP's Forward P/E has been as high as 12.76 and as low as 1.97, with a median of 9.81, all within the past year.We also note that XP holds a PEG ratio of 0.59. 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. XP's PEG compares to its industry's average PEG of 0.97. Within the past year, XP's PEG has been as high as 0.93 and as low as 0.16, with a median of 0.72.We should also highlight that XP has a P/B ratio of 2.07. The P/B ratio is used to compare a stock's market value with 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 2.62. Within the past 52 weeks, XP's P/B has been as high as 3.38 and as low as 1.63, with a median of 2.46.Finally, investors will want to recognize that XP has a P/CF ratio of 8.51. 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. XP's P/CF compares to its industry's average P/CF of 14.53. Over the past year, XP's P/CF has been as high as 15.83 and as low as 6.71, with a median of 10.69.These figures are just a handful of the metrics value investors tend to look at, but they help show that XP is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, XP feels like a great value stock at the moment.7 Best Stocks for the Next 30 DaysJust released: Experts distill 7 elite stocks from the current list of 220 Zacks Rank #1 Strong Buys. They deem these tickers "Most Likely for Early Price Pops."Since 1988, the full list has beaten the market more than 2X over with an average gain of +23.9% per year. So be sure to give these hand picked 7 your immediate attention. See them now >>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 XP Inc. (XP): 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