Are Investors Undervaluing Wintrust Financial (WTFC) Right Now?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 company value investors might notice is Wintrust Financial (WTFC). WTFC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 7.99 right now. For comparison, its industry sports an average P/E of 8.64. WTFC's Forward P/E has been as high as 10.12 and as low as 6.22, with a median of 8.14, all within the past year.
We should also highlight that WTFC has a P/B ratio of 1.01. The P/B is a method of comparing a stock's market value to 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 1.56. Over the past year, WTFC's P/B has been as high as 1.37 and as low as 0.81, with a median of 1.11.
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. WTFC has a P/S ratio of 1.66. This compares to its industry's average P/S of 1.81.
Finally, investors will want to recognize that WTFC has a P/CF ratio of 6.79. 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. WTFC's P/CF compares to its industry's average P/CF of 8.78. Over the past 52 weeks, WTFC's P/CF has been as high as 10.49 and as low as 5.86, with a median of 7.62.
These are only a few of the key metrics included in Wintrust Financial'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, WTFC looks like an impressive value stock at the moment.
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Wintrust Financial Corporation (WTFC) : Free Stock Analysis Report
