Are Investors Undervaluing CACI International (CACI) Right Now?

CACI

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore 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.

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 CACI International (CACI - Free Report) . CACI is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock is trading with a P/E ratio of 15.99, which compares to its industry's average of 18.48. Over the last 12 months, CACI's Forward P/E has been as high as 20.63 and as low as 13.45, with a median of 17.61.

CACI is also sporting a PEG ratio of 1.60. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CACI's industry has an average PEG of 1.64 right now. Within the past year, CACI's PEG has been as high as 2.06 and as low as 1.34, with a median of 1.76.

Investors should also recognize that CACI has a P/B ratio of 1.90. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. CACI's current P/B looks attractive when compared to its industry's average P/B of 3.22. Within the past 52 weeks, CACI's P/B has been as high as 2.33 and as low as 1.58, with a median of 1.96.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CACI has a P/S ratio of 0.9. This compares to its industry's average P/S of 1.22.

Finally, investors will want to recognize that CACI has a P/CF ratio of 10.25. 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. CACI's current P/CF looks attractive when compared to its industry's average P/CF of 13.08. CACI's P/CF has been as high as 13.33 and as low as 8.54, with a median of 11.07, all within the past year.

These are only a few of the key metrics included in CACI 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, CACI looks like an impressive value stock at the moment.

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