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Is CF Industries Holdings, Inc. (CF) Stock Over or Undervalued?

Wednesday, November 22, 2023 03:26 PM | InvestorsObserver Analysts

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Is CF Industries Holdings, Inc. (CF) Stock Over or Undervalued?

CF Industries Holdings, Inc. (CF) receives a strong valuation ranking of 66 from InvestorsObserver data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. CF has a better value than 66% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.

Valuation Rank - 66
CF gets a 66 Valuation Rank today. Find out what this means to you and get the rest of the rankings on CF!

Metrics Analysis

CF has a trailing twelve month Price to Earnings (PE) ratio of 7.01 which places it below the histroical average of roughly 15. CF is currently trading at a good value due to investors paying less than what the stock is worth in relation to its earnings. CF's trailing-12-month earnings per share (EPS) of 10.76 does justify its share price in the market. Trailing PE ratios do not factor in the company's projected growth rate, thus, some firms will have high PE ratios caused by high growth recruiting more investors even if the underlying company has produced low earnings so far.
CF has a 12 month forward PE to Growth (PEG) ratio of 1.62. Markets are overvaluing CF in relation to its projected growth as its PEG ratio is currently above the fair market value of 1. 10.76's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.

Summary

CF' has a weak valuation at its current share price on account of a overvalued PEG ratio due to strong growth. CF's PE and PEG are worse than the market average leading to a below average valuation score. Click Here to get the full Report on CF Industries Holdings, Inc. (CF) stock.

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