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.
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.
Phibro Animal Health (PAHC) is a stock many investors are watching right now. PAHC is currently holding a Zacks Rank #1 (Strong Buy) and a Value grade of A. The stock is trading with P/E ratio of 11.03 right now. For comparison, its industry sports an average P/E of 21.32. PAHC's Forward P/E has been as high as 15.21 and as low as 7.98, with a median of 12.29, all within the past year.
We should also highlight that PAHC has a P/B ratio of 3.71. 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 company's current P/B looks solid when compared to its industry's average P/B of 5.14. Over the past year, PAHC's P/B has been as high as 4.30 and as low as 2.51, with a median of 3.47.
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. PAHC has a P/S ratio of 0.83. This compares to its industry's average P/S of 1.39.
Value investors will likely look at more than just these metrics, but the above data helps show that Phibro Animal Health is likely undervalued currently. And when considering the strength of its earnings outlook, PAHC sticks out as one of the market's strongest value stocks.
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Phibro Animal Health Corporation (PAHC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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