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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. 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 stock to keep an eye on is Societe Generale Group (SCGLY). SCGLY is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 7.38. This compares to its industry's average Forward P/E of 9.40. Over the past 52 weeks, SCGLY's Forward P/E has been as high as 8.03 and as low as 4.01, with a median of 5.10.
We also note that SCGLY holds a PEG ratio of 0.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SCGLY's industry currently sports an average PEG of 0.73. Within the past year, SCGLY's PEG has been as high as 0.29 and as low as 0.08, with a median of 0.10.
Value investors also use the P/S ratio. The P/S ratio is calculated as price divided by sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. SCGLY has a P/S ratio of 1.57. This compares to its industry's average P/S of 1.61.
Finally, we should also recognize that SCGLY has a P/CF ratio of 9.59. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. SCGLY's current P/CF looks attractive when compared to its industry's average P/CF of 16.52. Over the past 52 weeks, SCGLY's P/CF has been as high as 10.04 and as low as 5.77, with a median of 7.98.
If you're looking for another solid Banks - Foreign value stock, take a look at Grupo Supervielle (SUPV). SUPV is a Zacks Rank of #2 (Buy) stock with a Value score of A.
Grupo Supervielle is trading at a forward earnings multiple of 7.57 at the moment, with a PEG ratio of 2.26. This compares to its industry's average P/E of 9.40 and average PEG ratio of 0.73.
SUPV's price-to-earnings ratio has been as high as 12.16 and as low as 5.93, with a median of 8.40, while its PEG ratio has been as high as 7.00 and as low as 2.25, with a median of 4.36, all within the past year.
Grupo Supervielle also has a P/B ratio of 1.16 compared to its industry's price-to-book ratio of 2.20. Over the past year, its P/B ratio has been as high as 1.93, as low as 0.69, with a median of 1.29.
Value investors will likely look at more than just these metrics, but the above data helps show that Societe Generale Group and Grupo Supervielle are likely undervalued currently. And when considering the strength of its earnings outlook, SCGLY and SUPV sticks out as one of the market's strongest value stocks.
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Societe Generale Group (SCGLY): Free Stock Analysis Report Grupo Supervielle S.A. (SUPV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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