The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
One stock to keep an eye on is Mr Cooper (COOP). COOP is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 5.01, while its industry has an average P/E of 8.15. Over the past 52 weeks, COOP's Forward P/E has been as high as 7.30 and as low as 3.68, with a median of 5.19.
Another valuation metric that we should highlight is COOP's P/B ratio of 0.65. The P/B is a method of comparing a stock's market value to 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 0.90. Over the past 12 months, COOP's P/B has been as high as 0.72 and as low as 0.10, with a median of 0.52.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. COOP has a P/S ratio of 0.76. This compares to its industry's average P/S of 1.39.
These are just a handful of the figures considered in Mr Cooper's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that COOP is an impressive value stock right now.
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MR. COOPER GROUP INC (COOP) : Free Stock Analysis Report
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