Back to top

Image: Bigstock

Should Value Investors Buy Hibbett Sports (HIBB) Stock?

Read MoreHide Full Article

Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. 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.

Hibbett Sports (HIBB - Free Report) is a stock many investors are watching right now. HIBB is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock has a Forward P/E ratio of 9.43. This compares to its industry's average Forward P/E of 18.84. Over the past 52 weeks, HIBB's Forward P/E has been as high as 21.02 and as low as 8.51, with a median of 13.41.

We should also highlight that HIBB has a P/B ratio of 2.76. Investors use the P/B ratio to look at a stock's market value versus 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 5.62. Over the past 12 months, HIBB's P/B has been as high as 3.38 and as low as 1.05, with a median of 2.16.

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. HIBB has a P/S ratio of 0.71. This compares to its industry's average P/S of 0.81.

Finally, our model also underscores that HIBB has a P/CF ratio of 6.19. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. HIBB's current P/CF looks attractive when compared to its industry's average P/CF of 22.35. HIBB's P/CF has been as high as 30.07 and as low as 6.19, with a median of 10.33, all within the past year.

These are just a handful of the figures considered in Hibbett Sports's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that HIBB is an impressive value stock right now.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Hibbett, Inc. (HIBB) - free report >>

Published in