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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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 to watch right now is South Plains Financial, Inc. (SPFI). SPFI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock holds a P/E ratio of 7.66, while its industry has an average P/E of 10.78. Over the past 52 weeks, SPFI's Forward P/E has been as high as 14.38 and as low as 6.81, with a median of 10.06.
Another valuation metric that we should highlight is SPFI's P/B ratio of 0.62. 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 0.91. Over the past year, SPFI's P/B has been as high as 1.28 and as low as 0.62, with a median of 0.87.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. SPFI has a P/S ratio of 1.04. This compares to its industry's average P/S of 1.67.
Finally, we should also recognize that SPFI has a P/CF ratio of 5.46. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 11. Over the past year, SPFI's P/CF has been as high as 13.08 and as low as 5.46, with a median of 7.75.
These figures are just a handful of the metrics value investors tend to look at, but they help show that South Plains Financial, Inc. Is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, SPFI feels like a great value stock at the moment.
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South Plains Financial, Inc. (SPFI) : Free Stock Analysis Report
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