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, value investing is easily one of the most popular ways to find great stocks in any market environment. 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 value investors might notice is FedEx (FDX). FDX is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 12.21. This compares to its industry's average Forward P/E of 13.50. Over the last 12 months, FDX's Forward P/E has been as high as 14.59 and as low as 9.89, with a median of 12.22.
Investors will also notice that FDX has a PEG ratio of 1.26. 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. FDX's industry currently sports an average PEG of 1.84. Over the last 12 months, FDX's PEG has been as high as 1.26 and as low as 0.83, with a median of 1.05.
Another valuation metric that we should highlight is FDX's P/B ratio of 1.97. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 4.82. Within the past 52 weeks, FDX's P/B has been as high as 2.74 and as low as 1.78, with a median of 2.19.
Finally, our model also underscores that FDX has a P/CF ratio of 6.55. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. FDX's current P/CF looks attractive when compared to its industry's average P/CF of 9.79. FDX's P/CF has been as high as 8.87 and as low as 5.72, with a median of 7.03, all within the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that FedEx is likely undervalued currently. And when considering the strength of its earnings outlook, FDX sticks out as one of the market's strongest value stocks.
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FedEx Corporation (FDX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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