Should Value Investors Buy Stoneridge (SRI) 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.
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 Stoneridge (SRI). SRI is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
We should also highlight that SRI has a P/B ratio of 1.71. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 4.56. Over the past year, SRI's P/B has been as high as 2.43 and as low as 1.42, with a median of 1.88.
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. SRI has a P/S ratio of 0.49. This compares to its industry's average P/S of 1.33.
Finally, our model also underscores that SRI has a P/CF ratio of 17.90. 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. SRI's P/CF compares to its industry's average P/CF of 25.90. Over the past 52 weeks, SRI's P/CF has been as high as 43.05 and as low as 16.70, with a median of 23.47.
These are just a handful of the figures considered in Stoneridge'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 SRI is an impressive value stock right now.
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Stoneridge, Inc. (SRI) : Free Stock Analysis Report
