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Is Vipshop Holdings Limited (VIPS) Stock Undervalued Right Now?

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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 use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Vipshop Holdings Limited (VIPS - Free Report) . VIPS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

We should also highlight that VIPS has a P/B ratio of 1.55. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 4.28. Over the past year, VIPS's P/B has been as high as 6.21 and as low as 1.24, with a median of 3.27.

Finally, investors should note that VIPS has a P/CF ratio of 7.44. 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 stock's P/CF looks attractive against its industry's average P/CF of 29.16. Over the past 52 weeks, VIPS's P/CF has been as high as 25.29 and as low as 5.97, with a median of 16.41.

Value investors will likely look at more than just these metrics, but the above data helps show that Vipshop Holdings Limited is likely undervalued currently. And when considering the strength of its earnings outlook, VIPS sticks out at as one of the market's strongest value stocks.


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