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Should Value Investors Buy Titan Machinery (TITN) Stock?

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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.

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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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 company value investors might notice is Titan Machinery (TITN - Free Report) . TITN is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A.

We should also highlight that TITN has a P/B ratio of 1.37. 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. This stock's P/B looks solid versus its industry's average P/B of 1.50. Over the past year, TITN's P/B has been as high as 1.42 and as low as 0.46, with a median of 0.77.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. TITN has a P/S ratio of 0.38. This compares to its industry's average P/S of 0.42.

Finally, investors should note that TITN has a P/CF ratio of 11.28. 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 stock's P/CF looks attractive against its industry's average P/CF of 11.41. Within the past 12 months, TITN's P/CF has been as high as 11.65 and as low as 3.73, with a median of 6.23.

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


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