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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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 to watch right now is Vector Group (VGR). VGR is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value.
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. VGR has a P/S ratio of 0.81. This compares to its industry's average P/S of 1.36.
Finally, investors will want to recognize that VGR has a P/CF ratio of 15.70. 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. This stock's P/CF looks attractive against its industry's average P/CF of 19.71. Over the past year, VGR's P/CF has been as high as 22.96 and as low as 12.79, with a median of 16.06.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Vector Group is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, VGR feels like a great value stock at the moment.
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Vector Group Ltd. (VGR) : Free Stock Analysis Report
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