Are Investors Undervaluing Fabrinet (FN) Right Now?
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
Fabrinet (FN) is a stock many investors are watching right now. FN 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 19.66, while its industry has an average P/E of 20.74. Over the past year, FN's Forward P/E has been as high as 21.74 and as low as 11.15, with a median of 16.59.
Another valuation metric that we should highlight is FN's P/B ratio of 4.06. 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 attractive against its industry's average P/B of 4.64. FN's P/B has been as high as 4.32 and as low as 2.30, with a median of 3.26, over the past year.
Finally, investors will want to recognize that FN has a P/CF ratio of 21.30. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. FN's current P/CF looks attractive when compared to its industry's average P/CF of 26.32. Over the past 52 weeks, FN's P/CF has been as high as 22.67 and as low as 11.80, with a median of 16.69.
Value investors will likely look at more than just these metrics, but the above data helps show that Fabrinet is likely undervalued currently. And when considering the strength of its earnings outlook, FN sticks out at as one of the market's strongest value stocks.
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Fabrinet (FN) : Free Stock Analysis Report
