Are Investors Undervaluing First United (FUNC) Right Now?
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.
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.
One stock to keep an eye on is First United (FUNC). FUNC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 9.19. This compares to its industry's average Forward P/E of 10.07. Over the last 12 months, FUNC's Forward P/E has been as high as 10.33 and as low as 5.46, with a median of 6.83.
We should also highlight that FUNC has a P/B ratio of 1.03. Investors use the P/B ratio to look at a stock's market value versus 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 1.42. Within the past 52 weeks, FUNC's P/B has been as high as 1.03 and as low as 0.55, with a median of 0.72.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. FUNC has a P/S ratio of 1.69. This compares to its industry's average P/S of 1.88.
Finally, investors should note that FUNC has a P/CF ratio of 6.91. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. FUNC's P/CF compares to its industry's average P/CF of 12.07. Within the past 12 months, FUNC's P/CF has been as high as 6.91 and as low as 3.18, with a median of 4.39.
Midland States Bancorp (MSBI) may be another strong Banks - Northeast stock to add to your shortlist. MSBI is a # 2 (Buy) stock with a Value grade of A.
Furthermore, Midland States Bancorp holds a P/B ratio of 0.91 and its industry's price-to-book ratio is 1.42. MSBI's P/B has been as high as 0.94, as low as 0.62, with a median of 0.73 over the past 12 months.
These are only a few of the key metrics included in First United and Midland States Bancorp strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, FUNC and MSBI look like an impressive value stock at the moment.
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First United Corporation (FUNC) : Free Stock Analysis Report
Midland States Bancorp, Inc. (MSBI) : Free Stock Analysis Report
