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Are Investors Undervaluing Fossil Group (FOSL) Right Now?

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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.

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 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 to watch right now is Fossil Group (FOSL - Free Report) . FOSL is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. FOSL has a P/S ratio of 0.19. This compares to its industry's average P/S of 0.4.

Finally, investors should note that FOSL has a P/CF ratio of 4.77. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 6.09. Over the past 52 weeks, FOSL's P/CF has been as high as 14.20 and as low as -18.63, with a median of 5.26.

These are just a handful of the figures considered in Fossil Group's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that FOSL is an impressive value stock right now.


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