Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
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.
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 company to watch right now is HudBay Minerals (HBM). HBM is currently sporting a Zacks Rank #1 (Strong Buy), as well as a Value grade of A.
Investors will also notice that HBM has a PEG ratio of 0.30. 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. HBM's PEG compares to its industry's average PEG of 0.38. Within the past year, HBM's PEG has been as high as 0.48 and as low as 0.22, with a median of 0.27.
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. HBM has a P/S ratio of 2.07. This compares to its industry's average P/S of 3.45.
Another great Mining - Miscellaneous stock you could consider is Silvercorp Metals (SVM), which is a Zacks Rank of #2 (Buy) stock with a Value Score of A.
Silvercorp Metals also has a P/B ratio of 1.17 compared to its industry's price-to-book ratio of 10.18. Over the past year, its P/B ratio has been as high as 1.34, as low as 0.76, with a median of 1.01.
Value investors will likely look at more than just these metrics, but the above data helps show that HudBay Minerals and Silvercorp Metals are likely undervalued currently. And when considering the strength of its earnings outlook, HBM and SVM sticks out as one of the market's strongest value stocks.
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HudBay Minerals Inc (HBM): Free Stock Analysis Report Silvercorp Metals Inc. (SVM): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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