Are Investors Undervaluing Harte Hanks (HHS) Right Now?
The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
Harte Hanks (HHS) is a stock many investors are watching right now. HHS is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 6.71. This compares to its industry's average Forward P/E of 8.04. Over the past 52 weeks, HHS's Forward P/E has been as high as 11.65 and as low as 4.25, with a median of 7.45.
HHS is also sporting a PEG ratio of 0.56. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. HHS's PEG compares to its industry's average PEG of 1.60. HHS's PEG has been as high as 0.97 and as low as 0.51, with a median of 0.70, all within 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. HHS has a P/S ratio of 0.38. This compares to its industry's average P/S of 0.88.
Finally, investors should note that HHS has a P/CF ratio of 5.19. 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. This stock's P/CF looks attractive against its industry's average P/CF of 8.74. Over the past year, HHS's P/CF has been as high as 7.98 and as low as 2.38, with a median of 3.23.
These are only a few of the key metrics included in Harte Hanks's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, HHS looks like an impressive value stock at the moment.
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