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Is Vista Outdoor (VSTO) a Great Value Stock Right Now?

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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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 value investors might notice is Vista Outdoor (VSTO - Free Report) . VSTO is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock is trading with a P/E ratio of 12.26, which compares to its industry's average of 29.68. Over the past year, VSTO's Forward P/E has been as high as 47.08 and as low as 7.87, with a median of 11.75.

Investors should also recognize that VSTO has a P/B ratio of 3.45. 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 attractive against its industry's average P/B of 7.15. VSTO's P/B has been as high as 3.54 and as low as 1.42, with a median of 2.39, 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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. VSTO has a P/S ratio of 1.12. This compares to its industry's average P/S of 2.1.

Value investors will likely look at more than just these metrics, but the above data helps show that Vista Outdoor is likely undervalued currently. And when considering the strength of its earnings outlook, VSTO sticks out at as one of the market's strongest value stocks.


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