Should Value Investors Buy Herc Holdings (HRI) Stock?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 company to watch right now is Herc Holdings (HRI). HRI is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.07, while its industry has an average P/E of 14.59. Over the past 52 weeks, HRI's Forward P/E has been as high as 12.09 and as low as 6.69, with a median of 8.99.
HRI is also sporting a PEG ratio of 0.79. 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. HRI's industry has an average PEG of 1.21 right now. Within the past year, HRI's PEG has been as high as 0.90 and as low as 0.45, with a median of 0.68.
Finally, investors will want to recognize that HRI has a P/CF ratio of 4.03. 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. This stock's P/CF looks attractive against its industry's average P/CF of 8.17. Within the past 12 months, HRI's P/CF has been as high as 4.33 and as low as 2.67, with a median of 3.48.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Herc Holdings is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, HRI feels like a great value stock at the moment.
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Herc Holdings Inc. (HRI) : Free Stock Analysis Report
