Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put BofI Holding, Inc. stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, BofI Holding has a trailing twelve months PE ratio of 14.66, as you can see in the chart below:
This level actually compares pretty favorably with the market at large as well, as the PE for the S&P 500 stands at about 20.10. If we focus on the PE trend, BofI Holding’s current PE level puts it slightly below its midpoint (which stands at 14.93) over the past five years and is also way below its high of 31.89 over the same time frame, indicating that the stock is currently undervalued.
Further, the stock’s PE also compares favorably with the Zacks classified Banks-West industry’s trailing twelve months PE ratio, which stands at 20.55. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that BofI Holding has a forward PE ratio (price relative to this year’s earnings) of 13.80, so it is fair to say that a slightly more value-oriented path may be ahead for BofI Holding stock in the near term too.
P/CF Ratio
An often overlooked ratio that can still be a great indicator of value is the price/cash flow metric. This ratio doesn’t take amortization and depreciation into account, so can give a more accurate picture of the financial health in a business. This is a preferred metric to some valuation investors because cash flows are (a) generally less prone to manipulation by the company’s management and (b) are less affected by variation in accounting policies between different companies.
The ratio is generally applied to find out whether a company’s stock is overpriced or underpriced with reference to its cash flows generation potential compared with its competitors. However, it is not commonly used for cross-industry comparison, as the average price to cash flow ratio varies from industry to industry.
In this case, BofI Holding’s P/CF ratio of 14.42 is lower than the Zacks classified Banks-West industry’s average of 16.37, which indicates that the stock is somewhat undervalued at this point of time.
Broad Value Outlook
In aggregate, BofI Holding currently has a Zacks Value Style Score of ‘B’, putting it into the top 40% of all stocks we cover from this look. This makes PBF Logistics a decent choice for value investors, and some of its other key metrics make this pretty clear too.
For example, the PEG ratio forBofI Holding comes in at 1.38, a level that is slightly lower than the industry average of 1.94. The PEG ratio is a modified PE ratio that takes into account the stock’s earnings growth rate. Additionally, its P/S ratio (another great indicator of value) comes in at 4.81, which is better than the industry average of 5.01.
Clearly, BofI Holding is a solid choice on the value front from multiple angles.
What About the Stock Overall?
Though BofI Holding might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘D’ and a Momentum score of ‘B’. This gives BOFI a Zacks VGM score—or its overarching fundamental grade—of ‘B’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimates have been mixed at best. The current quarter has seen one estimate go higher and one estimate go lower in the past sixty days, while the full year estimate has seen two upward and one downward revision in the same time period.
This has had a mixed impact on the consensus estimate, as the current quarter consensus estimate has remained stable in the past two months, while the full year estimate has risen by 0.5% over the same time frame.
You can see the consensus estimate trend and recent price action for the stock in the chart below:
BofI Holding, Inc. Price and Consensus
This somewhat mixed trend is why the stock has just a Zacks Rank #3 (Hold) and why we are looking for in-line performance from the company in the near term.
Bottom Line
BofI Holding is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Despite having a Zacks Rank #3, the stock belongs to a strong industry (which ranks among the Top 6% out of more than 250 industries), which indicates that broader factors are favorable for the company in the immediate future.
In fact, over the past one year, the Zacks categorized Banks-Westindustry has clearly outperformed the broader market, as you can see below:
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So, it might pay for value investors to delve deeper into the company’s prospects, as fundamentals and broader factors indicate that this stock could be a compelling pick.
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Does BofI Holding Offer a Great Value Buying Opportunity Now?
Value investing is easily one of the most popular ways to find great stocks in any market environment. After all, who wouldn’t want to find stocks that are either flying under the radar and are compelling buys, or offer up tantalizing discounts when compared to fair value?
One way to find these companies is by looking at several key metrics and financial ratios, many of which are crucial in the value stock selection process. Let’s put BofI Holding, Inc. stock into this equation and find out if it is a good choice for value-oriented investors right now, or if investors subscribing to this methodology should look elsewhere for top picks:
PE Ratio
A key metric that value investors always look at is the Price to Earnings Ratio, or PE for short. This shows us how much investors are willing to pay for each dollar of earnings in a given stock, and is easily one of the most popular financial ratios in the world. The best use of the PE ratio is to compare the stock’s current PE ratio with: a) where this ratio has been in the past; b) how it compares to the average for the industry/sector; and c) how it compares to the market as a whole.
On this front, BofI Holding has a trailing twelve months PE ratio of 14.66, as you can see in the chart below:
This level actually compares pretty favorably with the market at large as well, as the PE for the S&P 500 stands at about 20.10. If we focus on the PE trend, BofI Holding’s current PE level puts it slightly below its midpoint (which stands at 14.93) over the past five years and is also way below its high of 31.89 over the same time frame, indicating that the stock is currently undervalued.
Further, the stock’s PE also compares favorably with the Zacks classified Banks-West industry’s trailing twelve months PE ratio, which stands at 20.55. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that BofI Holding has a forward PE ratio (price relative to this year’s earnings) of 13.80, so it is fair to say that a slightly more value-oriented path may be ahead for BofI Holding stock in the near term too.
P/CF Ratio
An often overlooked ratio that can still be a great indicator of value is the price/cash flow metric. This ratio doesn’t take amortization and depreciation into account, so can give a more accurate picture of the financial health in a business. This is a preferred metric to some valuation investors because cash flows are (a) generally less prone to manipulation by the company’s management and (b) are less affected by variation in accounting policies between different companies.
The ratio is generally applied to find out whether a company’s stock is overpriced or underpriced with reference to its cash flows generation potential compared with its competitors. However, it is not commonly used for cross-industry comparison, as the average price to cash flow ratio varies from industry to industry.
In this case, BofI Holding’s P/CF ratio of 14.42 is lower than the Zacks classified Banks-West industry’s average of 16.37, which indicates that the stock is somewhat undervalued at this point of time.
Broad Value Outlook
In aggregate, BofI Holding currently has a Zacks Value Style Score of ‘B’, putting it into the top 40% of all stocks we cover from this look. This makes PBF Logistics a decent choice for value investors, and some of its other key metrics make this pretty clear too.
For example, the PEG ratio forBofI Holding comes in at 1.38, a level that is slightly lower than the industry average of 1.94. The PEG ratio is a modified PE ratio that takes into account the stock’s earnings growth rate. Additionally, its P/S ratio (another great indicator of value) comes in at 4.81, which is better than the industry average of 5.01.
Clearly, BofI Holding is a solid choice on the value front from multiple angles.
What About the Stock Overall?
Though BofI Holding might be a good choice for value investors, there are plenty of other factors to consider before investing in this name. In particular, it is worth noting that the company has a Growth grade of ‘D’ and a Momentum score of ‘B’. This gives BOFI a Zacks VGM score—or its overarching fundamental grade—of ‘B’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimates have been mixed at best. The current quarter has seen one estimate go higher and one estimate go lower in the past sixty days, while the full year estimate has seen two upward and one downward revision in the same time period.
This has had a mixed impact on the consensus estimate, as the current quarter consensus estimate has remained stable in the past two months, while the full year estimate has risen by 0.5% over the same time frame.
You can see the consensus estimate trend and recent price action for the stock in the chart below:
BofI Holding, Inc. Price and Consensus
BofI Holding, Inc. Price and Consensus | BofI Holding, Inc. Quote
This somewhat mixed trend is why the stock has just a Zacks Rank #3 (Hold) and why we are looking for in-line performance from the company in the near term.
Bottom Line
BofI Holding is an inspired choice for value investors, as it is hard to beat its incredible lineup of statistics on this front. Despite having a Zacks Rank #3, the stock belongs to a strong industry (which ranks among the Top 6% out of more than 250 industries), which indicates that broader factors are favorable for the company in the immediate future.
In fact, over the past one year, the Zacks categorized Banks-Westindustry has clearly outperformed the broader market, as you can see below:
So, it might pay for value investors to delve deeper into the company’s prospects, as fundamentals and broader factors indicate that this stock could be a compelling pick.
Just Released – Driverless Cars: Your Roadmap to Mega-Profits Today
In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>