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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
PCB Bancorp (PCB) is a stock many investors are watching right now. PCB is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with a P/E ratio of 8.25, which compares to its industry's average of 13.07. Over the past year, PCB's Forward P/E has been as high as 12.02 and as low as 7.72, with a median of 9.74.
Another valuation metric that we should highlight is PCB's P/B ratio of 0.97. The P/B ratio pits a stock's market value against 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 1.85. Within the past 52 weeks, PCB's P/B has been as high as 1.19 and as low as 0.74, with a median of 0.95.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. PCB has a P/S ratio of 1.44. This compares to its industry's average P/S of 2.03.
Finally, we should also recognize that PCB has a P/CF ratio of 8.69. 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. PCB's P/CF compares to its industry's average P/CF of 18.64. Within the past 12 months, PCB's P/CF has been as high as 10.91 and as low as 7.17, with a median of 9.19.
These are just a handful of the figures considered in PCB Bancorp'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 PCB is an impressive value stock right now.
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PCB Bancorp (PCB): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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