Are Investors Undervaluing Ameris Bancorp (ABCB) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Ameris Bancorp (ABCB). ABCB is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 9.98, while its industry has an average P/E of 11.53. Over the last 12 months, ABCB's Forward P/E has been as high as 13.55 and as low as 9.54, with a median of 11.35.
We should also highlight that ABCB has a P/B ratio of 1.09. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 1.70. Within the past 52 weeks, ABCB's P/B has been as high as 1.48 and as low as 1.04, with a median of 1.24.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ABCB has a P/S ratio of 3.04. This compares to its industry's average P/S of 3.19.
Finally, our model also underscores that ABCB has a P/CF ratio of 7.60. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.53. Over the past 52 weeks, ABCB's P/CF has been as high as 13.34 and as low as 6.98, with a median of 8.36.
These are only a few of the key metrics included in Ameris Bancorp'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, ABCB looks like an impressive value stock at the moment.
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