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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 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 Best Buy (BBY - Free Report) . BBY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 14.76. This compares to its industry's average Forward P/E of 27.51. BBY's Forward P/E has been as high as 18.83 and as low as 7.95, with a median of 14.77, all within the past year.
We also note that BBY holds a PEG ratio of 1.44. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BBY's PEG compares to its industry's average PEG of 3.08. Within the past year, BBY's PEG has been as high as 2.48 and as low as 0.98, with a median of 1.80.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BBY has a P/S ratio of 0.65. This compares to its industry's average P/S of 0.85.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Best Buy is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BBY feels like a great value stock at the moment.
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Is Best Buy (BBY) Stock Undervalued Right Now?
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 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 Best Buy (BBY - Free Report) . BBY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock has a Forward P/E ratio of 14.76. This compares to its industry's average Forward P/E of 27.51. BBY's Forward P/E has been as high as 18.83 and as low as 7.95, with a median of 14.77, all within the past year.
We also note that BBY holds a PEG ratio of 1.44. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BBY's PEG compares to its industry's average PEG of 3.08. Within the past year, BBY's PEG has been as high as 2.48 and as low as 0.98, with a median of 1.80.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. BBY has a P/S ratio of 0.65. This compares to its industry's average P/S of 0.85.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Best Buy is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, BBY feels like a great value stock at the moment.