Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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 Bank OZK (OZK). OZK is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 7.91, which compares to its industry's average of 10.25. Over the past 52 weeks, OZK's Forward P/E has been as high as 8.78 and as low as 6.06, with a median of 7.33.
Another notable valuation metric for OZK is its P/B ratio of 1.06. 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 1.09. OZK's P/B has been as high as 1.12 and as low as 0.78, with a median of 0.96, over the past year.
Finally, investors should note that OZK has a P/CF ratio of 7.19. 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 16.17. Over the past 52 weeks, OZK's P/CF has been as high as 7.39 and as low as 5.25, with a median of 6.38.
These are just a handful of the figures considered in Bank OZK'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 OZK is an impressive value stock right now.
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Bank OZK (OZK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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