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.
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 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 Casey's General Stores (CASY). CASY is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 25.12, while its industry has an average P/E of 25.36. CASY's Forward P/E has been as high as 27.92 and as low as 19.72, with a median of 24.46, all within the past year.
CASY is also sporting a PEG ratio of 2.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CASY's industry has an average PEG of 2.85 right now. Over the last 12 months, CASY's PEG has been as high as 3.28 and as low as 1.57, with a median of 2.59.
Finally, investors will want to recognize that CASY has a P/CF ratio of 8.19. 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 10.07. Within the past 12 months, CASY's P/CF has been as high as 8.67 and as low as 6.72, with a median of 7.75.
These are only a few of the key metrics included in Casey's General Stores'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, CASY looks like an impressive value stock at the moment.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Caseys General Stores, Inc. (CASY) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research