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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
One company value investors might notice is Flagstar Bancorp (FBC). FBC 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 7.94, while its industry has an average P/E of 8.92. Over the past year, FBC's Forward P/E has been as high as 9.21 and as low as 4.56, with a median of 7.65.
We should also highlight that FBC has a P/B ratio of 0.75. The P/B ratio is used to compare a stock's market value with 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 0.88. FBC's P/B has been as high as 1.12 and as low as 0.65, with a median of 0.86, over the past year.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. FBC has a P/S ratio of 1.32. This compares to its industry's average P/S of 2.75.
Finally, our model also underscores that FBC has a P/CF ratio of 4.66. 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. FBC's P/CF compares to its industry's average P/CF of 8.64. Over the past year, FBC's P/CF has been as high as 5.31 and as low as 3.43, with a median of 3.92.
Value investors will likely look at more than just these metrics, but the above data helps show that Flagstar Bancorp is likely undervalued currently. And when considering the strength of its earnings outlook, FBC sticks out at as one of the market's strongest value stocks.
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Flagstar Bancorp, Inc. (FBC) : Free Stock Analysis Report
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