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Should Value Investors Buy Haverty Furniture (HVT) Stock?

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Zacks Equity Research
·2 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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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 Haverty Furniture (HVT). HVT is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock holds a P/E ratio of 15.31, while its industry has an average P/E of 17.95. Over the last 12 months, HVT's Forward P/E has been as high as 30.88 and as low as -253.50, with a median of 16.75.

Another valuation metric that we should highlight is HVT's P/B ratio of 1.76. 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. This stock's P/B looks attractive against its industry's average P/B of 5.04. Over the past 12 months, HVT's P/B has been as high as 2.10 and as low as 0.74, with a median of 1.43.

Finally, our model also underscores that HVT has a P/CF ratio of 8.26. 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. HVT's current P/CF looks attractive when compared to its industry's average P/CF of 21.94. Over the past year, HVT's P/CF has been as high as 9.84 and as low as 4.96, with a median of 8.16.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Haverty Furniture is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, HVT feels like a great value stock at the moment.


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