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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 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 stock to keep an eye on is Boise Cascade (BCC). BCC is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value.
Another valuation metric that we should highlight is BCC's P/B ratio of 2.31. 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. BCC's current P/B looks attractive when compared to its industry's average P/B of 2.77. Over the past 12 months, BCC's P/B has been as high as 2.56 and as low as 1.15, with a median of 2.15.
Finally, we should also recognize that BCC has a P/CF ratio of 7.29. 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 23.65. BCC's P/CF has been as high as 10.20 and as low as 4.68, with a median of 7.26, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that Boise Cascade is likely undervalued currently. And when considering the strength of its earnings outlook, BCC sticks out at as one of the market's strongest value stocks.
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Boise Cascade, L.L.C. (BCC) : Free Stock Analysis Report
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