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.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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 to watch right now is Stagwell Inc. (STGW). STGW is currently sporting a Zacks Rank #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 4.94 right now. For comparison, its industry sports an average P/E of 8.27. Over the past year, STGW's Forward P/E has been as high as 9.95 and as low as 4.61, with a median of 7.88.
Finally, investors should note that STGW has a P/CF ratio of 6.45. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 9.59. Within the past 12 months, STGW's P/CF has been as high as 8.62 and as low as 3.86, with a median of 4.88.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Stagwell Inc. is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, STGW feels like a great value stock at the moment.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Stagwell Inc. (STGW): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
