While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
Delta Apparel (DLA - Free Report) is a stock many investors are watching right now. DLA is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock holds a P/E ratio of 13.88, while its industry has an average P/E of 22.75. Over the last 12 months, DLA's Forward P/E has been as high as 328.50 and as low as 13.16, with a median of 15.61.
Investors should also note that DLA holds a PEG ratio of 1.07. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. DLA's industry has an average PEG of 2.09 right now. Over the past 52 weeks, DLA's PEG has been as high as 1.20 and as low as 0.88, with a median of 1.07.
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. DLA has a P/S ratio of 0.26. This compares to its industry's average P/S of 0.66.
These are just a handful of the figures considered in Delta Apparel'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 DLA is an impressive value stock right now.