While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
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.
One company value investors might notice is Stagwell Inc. (STGW). STGW is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 5.89. This compares to its industry's average Forward P/E of 8.42. Over the past 52 weeks, STGW's Forward P/E has been as high as 9.95 and as low as 5.38, with a median of 8.11.
Another valuation metric that we should highlight is STGW's P/B ratio of 1.84. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 4.64. STGW's P/B has been as high as 2.87 and as low as 1.66, with a median of 2.30, over the past year.
Finally, our model also underscores that STGW has a P/CF ratio of 8.05. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 10.68. STGW's P/CF has been as high as 9.10 and as low as 3.86, with a median of 4.73, all within the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Stagwell Inc. Is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, STGW feels like a great value stock at the moment.
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Stagwell Inc. (STGW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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