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Are Investors Undervaluing Victory Capital Holdings (VCTR) Right Now?

Zacks Equity Research
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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.

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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Victory Capital Holdings (VCTR). VCTR is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 5.90 right now. For comparison, its industry sports an average P/E of 12.13. Over the past year, VCTR's Forward P/E has been as high as 8.03 and as low as 5.49, with a median of 6.43.

Investors should also note that VCTR holds a PEG ratio of 0.50. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. VCTR's industry has an average PEG of 1.19 right now. Over the past 52 weeks, VCTR's PEG has been as high as 0.68 and as low as 0.49, with a median of 0.62.

Another notable valuation metric for VCTR is its P/B ratio of 1.70. Investors use the P/B ratio to look at a stock's market value versus 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 1.92. VCTR's P/B has been as high as 3.17 and as low as 1.56, with a median of 1.83, over the past year.

Value investors will likely look at more than just these metrics, but the above data helps show that Victory Capital Holdings is likely undervalued currently. And when considering the strength of its earnings outlook, VCTR sticks out at as one of the market's strongest value stocks.


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