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 use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 inTest (INTT). INTT is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 9.91, while its industry has an average P/E of 21.73. Over the past year, INTT's Forward P/E has been as high as 14.02 and as low as 7.50, with a median of 10.51.
INTT is also sporting a PEG ratio of 0.99. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. INTT's PEG compares to its industry's average PEG of 1.85. Within the past year, INTT's PEG has been as high as 1.40 and as low as 0.75, with a median of 1.05.
Another valuation metric that we should highlight is INTT's P/B ratio of 1.93. 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. This stock's P/B looks solid versus its industry's average P/B of 4.04. INTT's P/B has been as high as 2.47 and as low as 1.55, with a median of 2.04, over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that inTest is likely undervalued currently. And when considering the strength of its earnings outlook, INTT sticks out at as one of the market's strongest value stocks.
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