While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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.
One stock to keep an eye on is Federal Agricultural Mortgage (AGM). AGM is currently holding a Zacks Rank #2 (Buy) and a Value grade of A.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. AGM has a P/S ratio of 1.27. This compares to its industry's average P/S of 1.89.
Value investors will likely look at more than just these metrics, but the above data helps show that Federal Agricultural Mortgage is likely undervalued currently. And when considering the strength of its earnings outlook, AGM sticks out as one of the market's strongest value stocks.
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Federal Agricultural Mortgage Corporation (AGM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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