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.
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One company to watch right now is Orix Corp Ads (IX). IX is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 7.44, which compares to its industry's average of 13.07. Over the past 52 weeks, IX's Forward P/E has been as high as 12.28 and as low as 7.44, with a median of 9.51.
Investors will also notice that IX has a PEG ratio of 0.80. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. IX's industry currently sports an average PEG of 0.85. Within the past year, IX's PEG has been as high as 1.10 and as low as 0.69, with a median of 0.96.
Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. IX has a P/S ratio of 1.08. This compares to its industry's average P/S of 1.58.
Finally, investors will want to recognize that IX has a P/CF ratio of 4.09. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 12.84. Over the past year, IX's P/CF has been as high as 5.77 and as low as 4.09, with a median of 4.93.
Value investors will likely look at more than just these metrics, but the above data helps show that Orix Corp Ads is likely undervalued currently. And when considering the strength of its earnings outlook, IX sticks out at as one of the market's strongest value stocks.
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Orix Corp Ads (IX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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