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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 Greenbrier Companies (GBX). GBX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 11.16, while its industry has an average P/E of 11.86. Over the last 12 months, GBX's Forward P/E has been as high as 15.76 and as low as 10.83, with a median of 12.74.
We should also highlight that GBX has a P/B ratio of 1.11. 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 company's current P/B looks solid when compared to its industry's average P/B of 1.37. Over the past year, GBX's P/B has been as high as 1.50 and as low as 1.01, with a median of 1.22.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GBX has a P/S ratio of 0.62. This compares to its industry's average P/S of 1.2.
Value investors will likely look at more than just these metrics, but the above data helps show that Greenbrier Companies is likely undervalued currently. And when considering the strength of its earnings outlook, GBX sticks out at as one of the market's strongest value stocks.
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Greenbrier Companies, Inc. (The) (GBX) : Free Stock Analysis Report
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