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Should Value Investors Buy Brink's (BCO) Stock?

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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.

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.

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 Brink's (BCO - Free Report) . BCO is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 11.42. This compares to its industry's average Forward P/E of 21.53. Over the past year, BCO's Forward P/E has been as high as 11.50 and as low as 8.29, with a median of 9.65.

Another valuation metric that we should highlight is BCO's P/B ratio of 7.05. The P/B ratio pits a stock's market value against 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 13.56. Within the past 52 weeks, BCO's P/B has been as high as 7.89 and as low as 4.38, with a median of 5.24.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. BCO has a P/S ratio of 0.82. This compares to its industry's average P/S of 1.23.

Finally, our model also underscores that BCO has a P/CF ratio of 10.20. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.67. Over the past year, BCO's P/CF has been as high as 10.26 and as low as 6.06, with a median of 8.54.

StarTek may be another strong Outsourcing stock to add to your shortlist. SRT is a # 1 (Strong Buy) stock with a Value grade of A.

StarTek is trading at a forward earnings multiple of 8.24 at the moment, with a PEG ratio of 0.55. This compares to its industry's average P/E of 21.53 and average PEG ratio of 2.02.

SRT's price-to-earnings ratio has been as high as 9.47 and as low as 5.22, with a median of 6.58, while its PEG ratio has been as high as 0.58 and as low as 0.37, with a median of 0.55, all within the past year.

StarTek sports a P/B ratio of 1.03 as well; this compares to its industry's price-to-book ratio of 13.56. In the past 52 weeks, SRT's P/B has been as high as 1.04, as low as 0.42, with a median of 0.64.

These are only a few of the key metrics included in Brink's and StarTek strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, BCO and SRT look like an impressive value stock at the moment.


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