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, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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.
Central Garden & Pet (CENT) is a stock many investors are watching right now. CENT is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 12.91 right now. For comparison, its industry sports an average P/E of 17.02. Over the last 12 months, CENT's Forward P/E has been as high as 19.24 and as low as 12.63, with a median of 14.87.
Finally, we should also recognize that CENT has a P/CF ratio of 9.07. 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 15.94. Over the past 52 weeks, CENT's P/CF has been as high as 13.47 and as low as 8.76, with a median of 10.38.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Central Garden & Pet is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CENT feels like a great value stock at the moment.
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Central Garden & Pet Company (CENT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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