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Should Value Investors Buy First Financial Bancorp (FFBC) Stock?

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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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

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.

One company to watch right now is First Financial Bancorp (FFBC - Free Report) . FFBC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 10.72 right now. For comparison, its industry sports an average P/E of 12.22. Over the past year, FFBC's Forward P/E has been as high as 12.88 and as low as 6.71, with a median of 11.06.

Investors should also recognize that FFBC has a P/B ratio of 0.59. 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. FFBC's current P/B looks attractive when compared to its industry's average P/B of 1.41. Within the past 52 weeks, FFBC's P/B has been as high as 1.16 and as low as 0.50, with a median of 0.65.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. FFBC has a P/S ratio of 1.87. This compares to its industry's average P/S of 1.88.

Finally, investors should note that FFBC has a P/CF ratio of 6.29. 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. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.36. FFBC's P/CF has been as high as 10.66 and as low as 5.08, with a median of 6.61, all within the past year.

These are only a few of the key metrics included in First Financial Bancorp'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, FFBC looks like an impressive value stock at the moment.


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