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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
Financial Institutions (FISI - Free Report) is a stock many investors are watching right now. FISI is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 8.62. This compares to its industry's average Forward P/E of 10.20. Over the past year, FISI's Forward P/E has been as high as 14.41 and as low as 5.16, with a median of 10.41.
Another valuation metric that we should highlight is FISI's P/B ratio of 0.55. 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. FISI's current P/B looks attractive when compared to its industry's average P/B of 0.92. Within the past 52 weeks, FISI's P/B has been as high as 1.28 and as low as 0.54, with a median of 1.14.
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. FISI has a P/S ratio of 1.11. This compares to its industry's average P/S of 1.84.
Finally, investors should note that FISI has a P/CF ratio of 4.50. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. FISI's P/CF compares to its industry's average P/CF of 11.35. Over the past 52 weeks, FISI's P/CF has been as high as 9.62 and as low as 3.88, with a median of 8.44.
These are just a handful of the figures considered in Financial Institutions'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 FISI is an impressive value stock right now.