We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is LabCorp (LH - Free Report) . LH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 10.94, while its industry has an average P/E of 17.15. Over the past year, LH's Forward P/E has been as high as 18.15 and as low as 8.57, with a median of 13.94.
Investors should also note that LH holds a PEG ratio of 1.08. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. LH's PEG compares to its industry's average PEG of 2.40. Over the past 52 weeks, LH's PEG has been as high as 3.50 and as low as 1.04, with a median of 1.68.
Another notable valuation metric for LH is its P/B ratio of 2.39. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 4.40. LH's P/B has been as high as 2.67 and as low as 1.34, with a median of 2.35, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. LH has a P/S ratio of 1.58. This compares to its industry's average P/S of 3.38.
Finally, investors should note that LH has a P/CF ratio of 12.13. 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. LH's current P/CF looks attractive when compared to its industry's average P/CF of 35.19. Within the past 12 months, LH's P/CF has been as high as 18.71 and as low as 6.41, with a median of 12.49.
Value investors will likely look at more than just these metrics, but the above data helps show that LabCorp is likely undervalued currently. And when considering the strength of its earnings outlook, LH sticks out at as one of the market's strongest value stocks.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is LabCorp (LH) a Great Value Stock Right Now?
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One stock to keep an eye on is LabCorp (LH - Free Report) . LH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 10.94, while its industry has an average P/E of 17.15. Over the past year, LH's Forward P/E has been as high as 18.15 and as low as 8.57, with a median of 13.94.
Investors should also note that LH holds a PEG ratio of 1.08. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. LH's PEG compares to its industry's average PEG of 2.40. Over the past 52 weeks, LH's PEG has been as high as 3.50 and as low as 1.04, with a median of 1.68.
Another notable valuation metric for LH is its P/B ratio of 2.39. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 4.40. LH's P/B has been as high as 2.67 and as low as 1.34, with a median of 2.35, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by 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. LH has a P/S ratio of 1.58. This compares to its industry's average P/S of 3.38.
Finally, investors should note that LH has a P/CF ratio of 12.13. 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. LH's current P/CF looks attractive when compared to its industry's average P/CF of 35.19. Within the past 12 months, LH's P/CF has been as high as 18.71 and as low as 6.41, with a median of 12.49.
Value investors will likely look at more than just these metrics, but the above data helps show that LabCorp is likely undervalued currently. And when considering the strength of its earnings outlook, LH sticks out at as one of the market's strongest value stocks.