In an interview with Wesley Gray, author of the book Quantitative Value, Fool editor and analyst Brendan Byrnes asks Gray to elaborate on the best valuation metric to use in evaluating a company's stock.

Gray discusses a study he performed with author Jack Vogle in which the two analyzed different valuation metrics. The conclusion may surprise you.

The Motley Fool's chief investment officer has selected his No. 1 stock for the next year. Find out which stock it is in the brand-new free report: "The Motley Fool's Top Stock for 2013." Just click here to access the report and find out the name of this under-the-radar company.

The article Is P/E Really the Best Tool for Picking an Undervalued Stock? originally appeared on

Brendan Byrnes owns shares of Ford, Caterpillar, and General Motors. The Motley Fool recommends Ford and General Motors and owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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