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Is HanesBrands (HBI) a Great Value Stock Right Now?

Zacks Equity Research

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. 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.

HanesBrands (HBI) is a stock many investors are watching right now. HBI is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 11 right now. For comparison, its industry sports an average P/E of 25.58. Over the past 52 weeks, HBI's Forward P/E has been as high as 13.90 and as low as 4.75, with a median of 8.31.

Another notable valuation metric for HBI is its P/B ratio of 4.62. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. HBI's current P/B looks attractive when compared to its industry's average P/B of 6.43. Over the past 12 months, HBI's P/B has been as high as 5.26 and as low as 2.36, with a median of 4.30.

These are only a few of the key metrics included in HanesBrands's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, HBI looks like an impressive value stock at the moment.


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Zacks Investment Research