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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 The Travelers Companies (TRV). TRV is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 11.6, while its industry has an average P/E of 27.56. Over the last 12 months, TRV's Forward P/E has been as high as 14.64 and as low as 11.13, with a median of 12.44.
We also note that TRV holds a PEG ratio of 2.87. 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. TRV's industry has an average PEG of 4.06 right now. Within the past year, TRV's PEG has been as high as 4.80 and as low as 1.01, with a median of 2.83.
Finally, investors should note that TRV has a P/CF ratio of 4.84. 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. TRV's P/CF compares to its industry's average P/CF of 13.04. Over the past 52 weeks, TRV's P/CF has been as high as 5.29 and as low as 4.23, with a median of 4.74.
Value investors will likely look at more than just these metrics, but the above data helps show that The Travelers Companies is likely undervalued currently. And when considering the strength of its earnings outlook, TRV sticks out as one of the market's strongest value stocks.
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The Travelers Companies, Inc. (TRV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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