Is First Bank (FRBA) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 company value investors might notice is First Bank (FRBA). FRBA is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 7.50, which compares to its industry's average of 8.89. Over the past 52 weeks, FRBA's Forward P/E has been as high as 9.55 and as low as 5.38, with a median of 7.44.
Investors should also recognize that FRBA has a P/B ratio of 0.72. The P/B is a method of comparing a stock's market value to 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 1.26. Over the past year, FRBA's P/B has been as high as 0.90 and as low as 0.57, with a median of 0.73.
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. FRBA has a P/S ratio of 1.5. This compares to its industry's average P/S of 1.67.
These figures are just a handful of the metrics value investors tend to look at, but they help show that First Bank is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, FRBA feels like a great value stock at the moment.
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First Bank (FRBA) : Free Stock Analysis Report
