Are These Retail-Wholesale Stocks a Great Value Stocks 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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 company to watch right now is Ethan Allen Interiors Inc. (ETD). ETD is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 8.23, which compares to its industry's average of 11.05. Over the last 12 months, ETD's Forward P/E has been as high as 15.50 and as low as 7.35, with a median of 9.04.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ETD has a P/S ratio of 0.9. This compares to its industry's average P/S of 1.06.
Finally, investors should note that ETD has a P/CF ratio of 6.86. 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 12.52. Over the past 52 weeks, ETD's P/CF has been as high as 24.07 and as low as 6.14, with a median of 8.
Investors could also keep in mind Haverty Furniture Companies (HVT), an Retail - Home Furnishings stock with a Zacks Rank of # 2 (Buy) and Value grade of A.
Haverty Furniture Companies also has a P/B ratio of 2.05 compared to its industry's price-to-book ratio of 6.82. Over the past year, its P/B ratio has been as high as 3.50, as low as 1.75, with a median of 2.27.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Ethan Allen Interiors Inc. and Haverty Furniture Companies are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ETD and HVT feels like a great value stock at the moment.
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Ethan Allen Interiors Inc. (ETD) : Free Stock Analysis Report
Haverty Furniture Companies, Inc. (HVT) : Free Stock Analysis Report
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