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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 to watch right now is Teleflex (TFX). TFX is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A.
We also note that TFX holds a PEG ratio of 1.69. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. TFX's industry currently sports an average PEG of 2.35. Over the past 52 weeks, TFX's PEG has been as high as 2.09 and as low as 1.27, with a median of 1.76.
Another notable valuation metric for TFX is its P/B ratio of 1.33. Investors use the P/B ratio to look at a stock's market value versus 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 3.67. Within the past 52 weeks, TFX's P/B has been as high as 2.56 and as low as 1.14, with a median of 1.82.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. TFX has a P/S ratio of 1.88. This compares to its industry's average P/S of 2.73.
Finally, our model also underscores that TFX has a P/CF ratio of 7.96. 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 21.07. Within the past 12 months, TFX's P/CF has been as high as 22.89 and as low as 6.87, with a median of 13.23.
These are just a handful of the figures considered in Teleflex'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 TFX is an impressive value stock right now.
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Teleflex Incorporated (TFX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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