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.
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.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
Assurant (AIZ) is a stock many investors are watching right now. AIZ is currently sporting a Zacks Rank #2 (Buy), as well as an A grade for Value.
Another valuation metric that we should highlight is AIZ's P/B ratio of 1.94. The P/B ratio pits a stock's market value against 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 2.73. Over the past year, AIZ's P/B has been as high as 2.25 and as low as 1.71, with a median of 1.98.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. AIZ has a P/S ratio of 0.94. This compares to its industry's average P/S of 1.13.
These are only a few of the key metrics included in Assurant'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, AIZ looks like an impressive value stock at the moment.
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Assurant, Inc. (AIZ): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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