The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
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 company value investors might notice is Guild (GHLD). GHLD is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 7.97, while its industry has an average P/E of 18.71. Over the past year, GHLD's Forward P/E has been as high as 12.55 and as low as 7.07, with a median of 8.14.
Investors will also notice that GHLD has a PEG ratio of 0.75. 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. GHLD's PEG compares to its industry's average PEG of 1.07. GHLD's PEG has been as high as 0.89 and as low as 0.20, with a median of 0.25, all within the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. GHLD has a P/S ratio of 0.89. This compares to its industry's average P/S of 1.81.
Finally, we should also recognize that GHLD has a P/CF ratio of 10.63. 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. GHLD's P/CF compares to its industry's average P/CF of 21.04. Over the past year, GHLD's P/CF has been as high as 16.74 and as low as -18.04, with a median of 9.32.
Another great Financial - Miscellaneous Services stock you could consider is Synchrony Financial (SYF), which is a # 2 (Buy) stock with a Value Score of A.
Shares of Synchrony Financial currently holds a Forward P/E ratio of 7.28, and its PEG ratio is 0.58. In comparison, its industry sports average P/E and PEG ratios of 18.71 and 1.07.
SYF's Forward P/E has been as high as 10.68 and as low as 5.52, with a median of 8.23. During the same time period, its PEG ratio has been as high as 1.31, as low as 0.48, with a median of 0.92.
Additionally, Synchrony Financial has a P/B ratio of 1.47 while its industry's price-to-book ratio sits at 3.49. For SYF, this valuation metric has been as high as 1.81, as low as 1.09, with a median of 1.40 over the past year.
These are just a handful of the figures considered in Guild and Synchrony Financial'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 GHLD and SYF is an impressive value stock right now.
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Guild Holdings Company (GHLD): Free Stock Analysis Report Synchrony Financial (SYF): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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