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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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 stock to keep an eye on is Noble Midstream Partners (NBLX). NBLX is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
NBLX is also sporting a PEG ratio of 0.93. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NBLX's industry currently sports an average PEG of 1.60. NBLX's PEG has been as high as 0.93 and as low as 0.32, with a median of 0.45, all within the past year.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. NBLX has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.61.
Finally, we should also recognize that NBLX has a P/CF ratio of 1.42. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. NBLX's P/CF compares to its industry's average P/CF of 5.44. Within the past 12 months, NBLX's P/CF has been as high as 6.34 and as low as 0.68, with a median of 4.14.
These are only a few of the key metrics included in Noble Midstream Partners's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, NBLX looks like an impressive value stock at the moment.
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