Is Chico's FAS (CHS) a Great Value Stock Right Now?

JILL

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.

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 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.

Chico's FAS is a stock many investors are watching right now. CHS is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 6.65, which compares to its industry's average of 9.44. CHS's Forward P/E has been as high as 79.67 and as low as 6.56, with a median of 11.47, all within the past year.

Another valuation metric that we should highlight is CHS's P/B ratio of 2.47. The P/B ratio pits a stock's market value against 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 2.49. Over the past year, CHS's P/B has been as high as 4.95 and as low as 1.95, with a median of 2.88.

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. CHS has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.34.

Finally, we should also recognize that CHS has a P/CF ratio of 4.40. 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 stock's P/CF looks attractive against its industry's average P/CF of 5.43. Within the past 12 months, CHS's P/CF has been as high as 72.75 and as low as -13.60, with a median of 5.

Investors could also keep in mind J.Jill (JILL - Free Report) , an Retail - Apparel and Shoes stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.

J.Jill sports a P/B ratio of -5.58 as well; this compares to its industry's price-to-book ratio of 2.49. In the past 52 weeks, JILL's P/B has been as high as -1.66, as low as -6.39, with a median of -3.44.

These are just a handful of the figures considered in Chico's FAS and J.Jill'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 CHS and JILL is an impressive value stock right now.

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