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.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 BRF (BRFS). BRFS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 10.62. This compares to its industry's average Forward P/E of 15.85. Over the last 12 months, BRFS's Forward P/E has been as high as 23.56 and as low as 7.25, with a median of 10.47.
Another valuation metric that we should highlight is BRFS's P/B ratio of 1.24. 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 stock's P/B looks attractive against its industry's average P/B of 1.96. Over the past year, BRFS's P/B has been as high as 1.62 and as low as 1.07, with a median of 1.33.
Finally, we should also recognize that BRFS has a P/CF ratio of 4.56. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.89. Over the past year, BRFS's P/CF has been as high as 12.14 and as low as 4, with a median of 5.98.
These figures are just a handful of the metrics value investors tend to look at, but they help show that BRF is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BRFS feels like a great value stock at the moment.
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BRF S.A. (BRFS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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