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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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One company value investors might notice is Eni SpA (E). E 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 7.84, which compares to its industry's average of 8.38. Over the last 12 months, E's Forward P/E has been as high as 31.69 and as low as 7.84, with a median of 13.49.
Another notable valuation metric for E is its 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 1.10. Over the past 12 months, E's P/B has been as high as 1.13 and as low as 0.75, with a median of 0.92.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. E has a P/S ratio of 0.69. This compares to its industry's average P/S of 0.78.
Finally, investors should note that E has a P/CF ratio of 5.50. 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. E's P/CF compares to its industry's average P/CF of 6.89. Within the past 12 months, E's P/CF has been as high as 17.21 and as low as -29.36, with a median of 5.49.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Eni SpA is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, E feels like a great value stock at the moment.
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