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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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is Patrick Industries (PATK). PATK is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with a P/E ratio of 6.80, which compares to its industry's average of 8.87. Over the past year, PATK's Forward P/E has been as high as 15.21 and as low as 6.17, with a median of 9.21.
We should also highlight that PATK has a P/B ratio of 2.14. 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 stock's P/B looks solid versus its industry's average P/B of 2.58. Over the past year, PATK's P/B has been as high as 3.89 and as low as 1.90, with a median of 2.96.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. PATK has a P/S ratio of 0.42. This compares to its industry's average P/S of 1.21.
Finally, our model also underscores that PATK has a P/CF ratio of 4.80. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. PATK's current P/CF looks attractive when compared to its industry's average P/CF of 13.91. Over the past 52 weeks, PATK's P/CF has been as high as 11.96 and as low as 4.25, with a median of 6.86.
These are only a few of the key metrics included in Patrick Industries'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, PATK looks like an impressive value stock at the moment.
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Patrick Industries, Inc. (PATK) : Free Stock Analysis Report
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