Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 Harmony Biosciences (HRMY). HRMY is currently sporting a Zacks Rank #1 (Strong Buy), as well as an A grade for Value.
Investors should also recognize that HRMY has a P/B ratio of 2.42. 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 3.72. Within the past 52 weeks, HRMY's P/B has been as high as 4.20 and as low as 2.23, with a median of 2.87.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. HRMY has a P/S ratio of 2.64. This compares to its industry's average P/S of 6.72.
Finally, our model also underscores that HRMY has a P/CF ratio of 9.34. 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. HRMY's P/CF compares to its industry's average P/CF of 9.57. HRMY's P/CF has been as high as 16.61 and as low as 9.07, with a median of 11.73, all within the past year.
These are only a few of the key metrics included in Harmony Biosciences'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, HRMY looks like an impressive value stock at the moment.
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Harmony Biosciences Holdings, Inc. (HRMY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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