Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 to watch right now is Univest Corporation of Pennsylvania (UVSP). UVSP is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
Another valuation metric that we should highlight is UVSP's P/B ratio of 0.98. The P/B ratio is used to compare a stock's market value with 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 1.17. Over the past year, UVSP's P/B has been as high as 1.07 and as low as 0.81, with a median of 0.96.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. UVSP has a P/S ratio of 1.89. This compares to its industry's average P/S of 2.02.
Finally, our model also underscores that UVSP has a P/CF ratio of 10.53. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 12.74. Over the past 52 weeks, UVSP's P/CF has been as high as 11.36 and as low as 8.79, with a median of 10.30.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Univest Corporation of Pennsylvania is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, UVSP feels like a great value stock at the moment.
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Univest Corporation of Pennsylvania (UVSP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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