Should Value Investors Buy PFSweb (PFSW) Stock?
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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 value investors might notice is PFSweb (PFSW). PFSW is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 16.12, while its industry has an average P/E of 16.85. Over the last 12 months, PFSW's Forward P/E has been as high as 50.35 and as low as 5.57, with a median of 26.20.
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. PFSW has a P/S ratio of 0.41. This compares to its industry's average P/S of 0.46.
These figures are just a handful of the metrics value investors tend to look at, but they help show that PFSweb is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, PFSW feels like a great value stock at the moment.
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