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 NCS Multistage (NCSM). NCSM is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The stock holds a P/E ratio of 11.17, while its industry has an average P/E of 14.86. Over the past 52 weeks, NCSM's Forward P/E has been as high as 13.10 and as low as 7.39, with a median of 11.52.
We should also highlight that NCSM has a P/B ratio of 1.01. 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 company's current P/B looks solid when compared to its industry's average P/B of 2.01. Within the past 52 weeks, NCSM's P/B has been as high as 1.05 and as low as 0.38, with a median of 0.62.
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. NCSM has a P/S ratio of 0.74. This compares to its industry's average P/S of 0.77.
These figures are just a handful of the metrics value investors tend to look at, but they help show that NCS Multistage is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, NCSM feels like a great value stock at the moment.
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NCS Multistage Holdings, Inc. (NCSM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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