- (0:45) - Oversold Stocks: Stock Screen Criteria
- (6:40) - Tracey’s Top Stock Picks: ECHO, GIII, TCED, UNM, ARCB
- (12:50) - Episode Roundup: Podcast@Zacks.com
Welcome to Episode #122 of the Value Investor Podcast
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio service, shares some of her top value investing tips and stock picks.
With the stock market sell off accelerating, stock deals are emerging from the wreckage.
This is the chance that value investors have been looking for. Valuations are actually coming down and that means it’s a great time to get stocks on the cheap.
Tracey tried to screen for just cheap stocks, using the P/S ratio, PEG and the Zacks Rank but got a lot of stock names that she has seen before.
For 2019, she wanted some fresh picks which also had stellar value fundamentals.
Therefore, she turned to her Classic Value screen to find the stocks.
Screening for Classic Value
Classic value is what you would think it is. It combines all of the great value indicators in one place and also throws in the Zacks Rank of #1 (Strong Buy) or #2 (Buy) for extra firepower.
Those value components are a P/E under 15, a PEG under 1, a P/S ratio under 1 and a P/B ratio under 3.0.
This screen is still narrow but it returned 27 stocks.
5 Classic Value Stocks for 2019
1. Echo Global Logistics, Inc. ECHO is a supply chain management company with a PEG of just 0.7 and a P/S ratio of only 0.3. Shares are down 27% in 2018.
2. G-III Apparel GIII is a large retailer with both brick and mortar and wholesale operations through brands such as Wilson’s Leather, DKNY, Donna Karan and others. Shares are down 27% year-to-date but it’s also dirt cheap with a P/B of just 1.2 and a P/S ratio of 0.5.
3. Tech Data TECD distributes technology worldwide. Shares are down 17% year-to-date but it’s still extremely cheap. It has a forward P/E of just 7.5 and a P/B ratio of 1.1.
4. Unum Group UNM provides insurance, especially disability plans, and financial services in the United States and the United Kingdom. Shares have plunged 47% this year and are now dirt cheap. It is trading with a forward P/E of just 5.6. Shareholders also get a dividend, currently yielding 3.6%.
5. ArcBest Corporation ARCB is a freight and logistics company based in Arkansas. It has a long history, going all the way back to 1923. Shares are down just 5.3% year-to-date but there’s still a lot of value as it has a P/E of just 9.3 and a P/S ratio of 0.3.
The theme to the beginning of 2019 is sure to be the sheer number of value stocks on the market.
What else do you need to know about finding classic value stocks in 2019?
Tune into this week’s podcast to find out.
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Echo Global Logistics, Inc. (ECHO) : Free Stock Analysis Report
ArcBest Corporation (ARCB) : Free Stock Analysis Report
Unum Group (UNM) : Free Stock Analysis Report
Tech Data Corporation (TECD) : Free Stock Analysis Report
G-III Apparel Group, LTD. (GIII) : Free Stock Analysis Report
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