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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 Global Partners LP (GLP). GLP is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another notable valuation metric for GLP is its P/B ratio of 1.61. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. GLP's current P/B looks attractive when compared to its industry's average P/B of 1.92. Over the past 12 months, GLP's P/B has been as high as 1.77 and as low as 1.17, with a median of 1.56.
Finally, investors should note that GLP has a P/CF ratio of 3.91. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. GLP's current P/CF looks attractive when compared to its industry's average P/CF of 9.11. Within the past 12 months, GLP's P/CF has been as high as 4.41 and as low as 2.57, with a median of 3.78.
Value investors will likely look at more than just these metrics, but the above data helps show that Global Partners LP is likely undervalued currently. And when considering the strength of its earnings outlook, GLP sticks out at as one of the market's strongest value stocks.
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