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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 value investors might notice is Smith & Nephew SNATS (SNN). SNN is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 12.30, while its industry has an average P/E of 21.07. SNN's Forward P/E has been as high as 16.17 and as low as 11.60, with a median of 13.50, all within the past year.
Investors should also note that SNN holds a PEG ratio of 0.71. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. SNN's PEG compares to its industry's average PEG of 1.76. Over the last 12 months, SNN's PEG has been as high as 1.47 and as low as 0.67, with a median of 1.14.
We should also highlight that SNN has a P/B ratio of 2.22. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. SNN's current P/B looks attractive when compared to its industry's average P/B of 4.92. Within the past 52 weeks, SNN's P/B has been as high as 2.66 and as low as 1.98, with a median of 2.17.
These are just a handful of the figures considered in Smith & Nephew SNATS'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 SNN is an impressive value stock right now.
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Smith & Nephew SNATS, Inc. (SNN): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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