Should Value Investors Buy Sierra Bancorp (BSRR) Stock?
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.
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.
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.
Sierra Bancorp (BSRR) is a stock many investors are watching right now. BSRR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
We should also highlight that BSRR has a P/B ratio of 1.41. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. BSRR's current P/B looks attractive when compared to its industry's average P/B of 1.46. Within the past 52 weeks, BSRR's P/B has been as high as 1.81 and as low as 1.30, with a median of 1.57.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BSRR has a P/S ratio of 3.04. This compares to its industry's average P/S of 3.39.
Finally, investors should note that BSRR has a P/CF ratio of 9.22. 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. BSRR's current P/CF looks attractive when compared to its industry's average P/CF of 11.16. Over the past 52 weeks, BSRR's P/CF has been as high as 13.83 and as low as 8.53, with a median of 11.07.
These are just a handful of the figures considered in Sierra Bancorp'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 BSRR is an impressive value stock right now.
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