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Is Randstad Holding (RANJY) Stock Undervalued Right Now?

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·3 min read
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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.

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

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One stock to keep an eye on is Randstad Holding (RANJY). RANJY is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 9.58, which compares to its industry's average of 11.99. Over the past 52 weeks, RANJY's Forward P/E has been as high as 16.35 and as low as 9.31, with a median of 13.66.

Investors should also recognize that RANJY has a P/B ratio of 1.72. 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 2.94. RANJY's P/B has been as high as 2.86 and as low as 1.72, with a median of 2.37, over the past year.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. RANJY has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.49.

Finally, we should also recognize that RANJY has a P/CF ratio of 7.40. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 10.56. Within the past 12 months, RANJY's P/CF has been as high as 18.66 and as low as 7.37, with a median of 12.62.

Investors could also keep in mind Resources Connection (RGP), an Staffing Firms stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Resources Connection also has a P/B ratio of 1.58 compared to its industry's price-to-book ratio of 2.94. Over the past year, its P/B ratio has been as high as 1.87, as low as 1.33, with a median of 1.55.

These are only a few of the key metrics included in Randstad Holding and Resources Connection strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, RANJY and RGP look like an impressive value stock at the moment.

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Resources Connection, Inc. (RGP) : Free Stock Analysis Report
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