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 company to watch right now is LaZBoy (LZB). LZB is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value.
We should also highlight that LZB has a P/B ratio of 1.35. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. LZB's current P/B looks attractive when compared to its industry's average P/B of 1.44. Over the past year, LZB's P/B has been as high as 1.95 and as low as 1.35, with a median of 1.65.
Finally, we should also recognize that LZB has a P/CF ratio of 6.00. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 7.36. LZB's P/CF has been as high as 8.04 and as low as 5.96, with a median of 6.79, all within the past year.
These are only a few of the key metrics included in LaZBoy's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, LZB looks like an impressive value stock at the moment.
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La-Z-Boy Incorporated (LZB): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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