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 CBIZ, Inc. (CBZ - Free Report) 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, CBIZ, Inc. has a trailing twelve months PE ratio of 17.32, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 19.72. If we focus on the long-term PE trend, CBIZ, Inc.’s current PE level puts it above its midpoint over the past five years.
Further, the stock’s PE also compares favorably with the industry’s trailing twelve months PE ratio, which stands at 22.58. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that CBIZ, Inc. has a forward PE ratio (price relative to this year’s earnings) of just 16.72, so it is fair to say that a slightly more value-oriented path may be ahead for CBIZ, Inc. 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, CBIZ, Inc.’s P/CF ratio of 11.65 is higher than theindustry average of 13.59, which indicates that the stock is somewhat overvalued in this respect.
Broad Value Outlook
In aggregate, CBIZ, Inc. currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes CBIZ, Inc. a solid choice for value investors, and some of its other key metrics make this pretty clear too.
For example, its P/CF ratio comes in at 8.60, which is far better than the industry average of 11.68. Clearly, CBZ is a solid choice on the value front from multiple angles.
What About the Stock Overall?
Though CBIZ, Inc. 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 ‘A’ and a Momentum score of ‘B’. This gives CBZ a Zacks VGM score—or its overarching fundamental grade—of ‘A’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimates have been encouraging. The current quarter has seen one estimate go higher in the past sixty days compared to none lower, while the full year estimate has seen one up and none down in the same time period.
This has had an impact on the consensus estimate though as the current quarter consensus estimate has risen by 9.5% in the past two months, while the full year estimate has moved up by 6.1%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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 CBIZ, Inc. (CBZ - Free Report) 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, CBIZ, Inc. has a trailing twelve months PE ratio of 17.32, as you can see in the chart below:
This level actually compares pretty favorably with the market at large, as the PE for the S&P 500 stands at about 19.72. If we focus on the long-term PE trend, CBIZ, Inc.’s current PE level puts it above its midpoint over the past five years.
Further, the stock’s PE also compares favorably with the industry’s trailing twelve months PE ratio, which stands at 22.58. At the very least, this indicates that the stock is relatively undervalued right now, compared to its peers.
We should also point out that CBIZ, Inc. has a forward PE ratio (price relative to this year’s earnings) of just 16.72, so it is fair to say that a slightly more value-oriented path may be ahead for CBIZ, Inc. 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, CBIZ, Inc.’s P/CF ratio of 11.65 is higher than theindustry average of 13.59, which indicates that the stock is somewhat overvalued in this respect.
Broad Value Outlook
In aggregate, CBIZ, Inc. currently has a Zacks Value Style Score of ‘A’, putting it into the top 20% of all stocks we cover from this look. This makes CBIZ, Inc. a solid choice for value investors, and some of its other key metrics make this pretty clear too.
For example, its P/CF ratio comes in at 8.60, which is far better than the industry average of 11.68. Clearly, CBZ is a solid choice on the value front from multiple angles.
What About the Stock Overall?
Though CBIZ, Inc. 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 ‘A’ and a Momentum score of ‘B’. This gives CBZ a Zacks VGM score—or its overarching fundamental grade—of ‘A’. (You can read more about the Zacks Style Scores here >>)
Meanwhile, the company’s recent earnings estimates have been encouraging. The current quarter has seen one estimate go higher in the past sixty days compared to none lower, while the full year estimate has seen one up and none down in the same time period.
This has had an impact on the consensus estimate though as the current quarter consensus estimate has risen by 9.5% in the past two months, while the full year estimate has moved up by 6.1%. You can see the consensus estimate trend and recent price action for the stock in the chart below:
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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