Are Investors Undervaluing VAREX IMAGING (VREX) 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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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 stock to keep an eye on is VAREX IMAGING (VREX). VREX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.
We also note that VREX holds a PEG ratio of 1.14. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. VREX's industry currently sports an average PEG of 2.87. Over the past 52 weeks, VREX's PEG has been as high as 6.90 and as low as 1.10, with a median of 3.80.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. VREX has a P/S ratio of 0.97. This compares to its industry's average P/S of 1.79.
These are only a few of the key metrics included in VAREX IMAGING'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, VREX looks like an impressive value stock at the moment.
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VAREX IMAGING (VREX) : Free Stock Analysis Report
