Zacks.com featured highlights APi Group, Signet Jewelers, Sterling Infrastructure and EPR Properties
For Immediate Release
Chicago, IL – March 10, 2023 – Stocks in this week’s article are APi Group Corp. APG, Signet Jewelers Ltd. SIG, Sterling Infrastructure STRL and EPR Properties EPR.
Pick These 4 Low P/CF Stocks to Uplift Your Portfolio
Value style is considered one of the best practices when it comes to picking stocks. Value investing is essentially about selecting stocks that are fundamentally sound but have been beaten down by some external factors. Such stocks are poised to bounce back as and when investors recognize the inherent value of companies. Certainly, the value investment strategy best suits investors with a long-term horizon.
There are different valuation metrics to determine a stock’s inherent strength. Still, a random selection of a ratio cannot serve your purpose if you want a realistic assessment of a company’s financial position. For this, the Price to Cash Flow (or P/CF) ratio is one of the key metrics. APi Group Corp., Signet Jewelers Ltd., Sterling Infrastructure and EPR Properties boast a low P/CF ratio.
This metric evaluates the market price of a stock relative to the amount of cash flow that the company is generating on a per-share basis – the lower the number, the better. One of the important factors that makes P/CF a highly dependable metric is that operating cash flow adds back non-cash charges such as depreciation and amortization to net income, truly diagnosing a company's financial health.
Analysts caution that a company’s earnings are subject to accounting estimates and management manipulation. However, cash flow is reliable. Net cash flow unveils how much money a company is actually generating and how effectively management is deploying the same.
Positive cash flow indicates an increase in a company’s liquid assets. It gives the company the means to settle debt, meet its expenses, reinvest in its business, endure downturns and finally pay back its shareholders. Negative cash flow implies a decline in the company’s liquidity, which in turn lowers its flexibility to support these moves.
However, solely based on the P/CF metric, an investment decision may not fetch the desired results. To identify stocks trading at a discount, you should expand your search criteria and consider the price-to-book ratio, price-to-earnings ratio and price-to-sales ratio. Adding a favorable Zacks Rank and a Value Score of A or B to your search criteria should lead to even better results as these eliminate the chance of falling into a value trap.
Here are four of the seven stocks that qualified the screening:
APi Group is a market-leading business services provider of life safety, security and specialty services. This Zacks Rank #1 company has an expected EPS growth rate of 17% for three-five years. APG has a Value Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for APi Group’s current financial year sales and EPS suggests growth of 4.8% and 12%, respectively, from the year-ago period. The company has a trailing four-quarter earnings surprise of 4.6%, on average. Shares of APG have risen 14.2% in the past year.
Signet, the world's largest retailer of diamond jewelry, carries a Zacks Rank #2. It has an expected EPS growth rate of 8% for three-five years.
Signet has a trailing four-quarter earnings surprise of 44.8%, on average. SIG has a Value Score of A. The stock has increased 6.8% in the past year.
Sterling Infrastructure, which is engaged in transportation, e-infrastructure and building solutions, carries a Zacks Rank #2. It has an expected EPS growth rate of 18% for three-five years. The company has a trailing four-quarter earnings surprise of 19.3%, on average.
The Zacks Consensus Estimate for Sterling Infrastructure’s current financial-year EPS suggests growth of 10.8% from the year-ago period. Sterling Infrastructure has a Value Score of A. The STRL stock has jumped 44.2% in the past year.
EPR Properties, the leading diversified experiential net lease real estate investment trust, carries a Zacks Rank #2 and has an expected EPS growth rate of 9% for three-five years. The company has a trailing four-quarter earnings surprise of 3.8%, on average.
The Zacks Consensus Estimate for EPR Properties’ current financial year sales suggests growth of 0.8% from the year-ago period. EPR Properties has a Value Score of B. Shares of EPR have declined 23% in the past year.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2063625/pick-these-4-low-pcf-stocks-to-uplift-your-portfolio
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
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Signet Jewelers Limited (SIG) : Free Stock Analysis Report
Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report
EPR Properties (EPR) : Free Stock Analysis Report
APi Group Corporation (APG) : Free Stock Analysis Report
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