Are Investors Undervaluing FS Bancorp (FSBW) 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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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 company to watch right now is FS Bancorp (FSBW). FSBW is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with P/E ratio of 7.43 right now. For comparison, its industry sports an average P/E of 10.64. Over the past year, FSBW's Forward P/E has been as high as 9.52 and as low as 6.99, with a median of 8.12.
We should also highlight that FSBW has a P/B ratio of 1.25. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.58. Over the past 12 months, FSBW's P/B has been as high as 1.30 and as low as 0.95, with a median of 1.04.
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 popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. FSBW has a P/S ratio of 2.04. This compares to its industry's average P/S of 2.63.
Finally, our model also underscores that FSBW has a P/CF ratio of 6.34. 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. FSBW's current P/CF looks attractive when compared to its industry's average P/CF of 9.22. Over the past 52 weeks, FSBW's P/CF has been as high as 6.57 and as low as 4.66, with a median of 5.29.
These are just a handful of the figures considered in FS Bancorp's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FSBW is an impressive value stock right now.
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FS Bancorp, Inc. (FSBW) : Free Stock Analysis Report
