Should Value Investors Buy Republic Bancorp (RBCAA) Stock?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 Republic Bancorp (RBCAA). RBCAA is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Another valuation metric that we should highlight is RBCAA's P/B ratio of 1.02. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 1.89. Over the past 12 months, RBCAA's P/B has been as high as 1.18 and as low as 0.91, with a median of 1.05.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. RBCAA has a P/S ratio of 2.55. This compares to its industry's average P/S of 2.58.
Finally, investors should note that RBCAA has a P/CF ratio of 8.38. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 11.24. RBCAA's P/CF has been as high as 10.52 and as low as 7.51, with a median of 8.83, all within the past year.
These are only a few of the key metrics included in Republic Bancorp'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, RBCAA looks like an impressive value stock at the moment.
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Republic Bancorp, Inc. (RBCAA) : Free Stock Analysis Report
