Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
inTest (INTT) is a stock many investors are watching right now. INTT is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 6.74. This compares to its industry's average Forward P/E of 18.33. Over the past 52 weeks, INTT's Forward P/E has been as high as 13.14 and as low as 6.42, with a median of 9.45.
Investors will also notice that INTT has a PEG ratio of 0.67. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. INTT's PEG compares to its industry's average PEG of 1.38. Within the past year, INTT's PEG has been as high as 1.31 and as low as 0.64, with a median of 0.94.
We should also highlight that INTT has a P/B ratio of 1.57. 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 3.57. Within the past 52 weeks, INTT's P/B has been as high as 2.47 and as low as 1.50, with a median of 1.91.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. INTT has a P/S ratio of 0.89. This compares to its industry's average P/S of 1.21.
These are only a few of the key metrics included in inTest'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, INTT looks like an impressive value stock at the moment.
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