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.
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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Playtika (PLTK). PLTK is currently sporting a Zacks Rank #2 (Buy) and an A for Value.
We also note that PLTK holds a PEG ratio of 0.80. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. PLTK's industry has an average PEG of 1.13 right now. Over the last 12 months, PLTK's PEG has been as high as 2.80 and as low as 0.80, with a median of 1.20.
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. PLTK has a P/S ratio of 0.48. This compares to its industry's average P/S of 1.37.
These are just a handful of the figures considered in Playtika's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that PLTK is an impressive value stock right now.
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Playtika Holding Corp. (PLTK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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