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Are Investors Undervaluing CRA International (CRAI) 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.

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 stock to keep an eye on is CRA International (CRAI - Free Report) . CRAI is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 18.98 right now. For comparison, its industry sports an average P/E of 22.47. CRAI's Forward P/E has been as high as 26.52 and as low as 15.73, with a median of 23.42, all within the past year.

We should also highlight that CRAI has a P/B ratio of 2.12. The P/B is a method of comparing a stock's market value to 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 5.65. Over the past year, CRAI's P/B has been as high as 2.38 and as low as 1.64, with a median of 2.08.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CRAI has a P/S ratio of 0.97. This compares to its industry's average P/S of 1.31.

Finally, we should also recognize that CRAI has a P/CF ratio of 13.39. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 15.82. Over the past year, CRAI's P/CF has been as high as 26.80 and as low as 10.52, with a median of 19.98.

These are only a few of the key metrics included in CRA International's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, CRAI looks like an impressive value stock at the moment.


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