Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 value investors might notice is Canada Goose (GOOS). GOOS is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 8.85, while its industry has an average P/E of 13.98. GOOS's Forward P/E has been as high as 17.12 and as low as 8.09, with a median of 12.13, all within the past year.
Investors will also notice that GOOS has a PEG ratio of 0.60. 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. GOOS's industry has an average PEG of 1.11 right now. Over the last 12 months, GOOS's PEG has been as high as 2.55 and as low as 0.48, with a median of 0.60.
Another notable valuation metric for GOOS is its P/B ratio of 2. 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 4.77. Over the past 12 months, GOOS's P/B has been as high as 4.88 and as low as 1.83, with a median of 3.57.
Finally, investors will want to recognize that GOOS has a P/CF ratio of 5.02. 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. GOOS's P/CF compares to its industry's average P/CF of 11.19. Within the past 12 months, GOOS's P/CF has been as high as 10.82 and as low as 4.58, with a median of 7.12.
If you're looking for another solid Retail - Apparel and Shoes value stock, take a look at Urban Outfitters (URBN). URBN is a # 2 (Buy) stock with a Value score of A.
Urban Outfitters is trading at a forward earnings multiple of 10.25 at the moment, with a PEG ratio of 1.18. This compares to its industry's average P/E of 13.98 and average PEG ratio of 1.11.
URBN's Forward P/E has been as high as 14.69 and as low as 9.02, with a median of 11.33. During the same time period, its PEG ratio has been as high as 1.49, as low as 0.57, with a median of 0.99.
Furthermore, Urban Outfitters holds a P/B ratio of 1.81 and its industry's price-to-book ratio is 4.77. URBN's P/B has been as high as 2.37, as low as 1.40, with a median of 1.81 over the past 12 months.
These are just a handful of the figures considered in Canada Goose and Urban Outfitters'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 GOOS and URBN is an impressive value stock right now.
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Canada Goose Holdings Inc. (GOOS): Free Stock Analysis Report Urban Outfitters, Inc. (URBN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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