Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.
Old Republic International (ORI) is a stock many investors are watching right now. ORI is currently holding a Zacks Rank #2 (Buy) and a Value grade of A.
We should also highlight that ORI has a P/B ratio of 1.43. The P/B ratio pits a stock's market value against 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 2.38. Over the past 12 months, ORI's P/B has been as high as 1.76 and as low as 1.35, with a median of 1.53.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ORI has a P/S ratio of 1.03. This compares to its industry's average P/S of 1.06.
Finally, our model also underscores that ORI has a P/CF ratio of 10.13. 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. ORI's P/CF compares to its industry's average P/CF of 10.41. ORI's P/CF has been as high as 19.84 and as low as 9.82, with a median of 11.80, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Old Republic International is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, ORI feels like a great value stock at the moment.
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Old Republic International Corporation (ORI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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