Should Value Investors Buy Willdan Group (WLDN) Stock?
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.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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.
One company value investors might notice is Willdan Group (WLDN). WLDN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 13.08. This compares to its industry's average Forward P/E of 21.06. Over the last 12 months, WLDN's Forward P/E has been as high as 22.46 and as low as 11.37, with a median of 14.19.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. WLDN has a P/S ratio of 0.61. This compares to its industry's average P/S of 0.99.
Finally, investors will want to recognize that WLDN has a P/CF ratio of 13.32. 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 company's current P/CF looks solid when compared to its industry's average P/CF of 24.22. Within the past 12 months, WLDN's P/CF has been as high as 23.08 and as low as 11.35, with a median of 13.88.
These are only a few of the key metrics included in Willdan Group'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, WLDN looks like an impressive value stock at the moment.
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Willdan Group, Inc. (WLDN) : Free Stock Analysis Report
