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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.
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 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 stock to keep an eye on is Franklin Resources (BEN - Free Report) . BEN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 9.27, while its industry has an average P/E of 13.86. Over the last 12 months, BEN's Forward P/E has been as high as 11.32 and as low as 8.27, with a median of 9.27.
BEN is also sporting a PEG ratio of 0.62. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. BEN's PEG compares to its industry's average PEG of 1.02. Over the past 52 weeks, BEN's PEG has been as high as 1.69 and as low as 0.62, with a median of 0.85.
Another valuation metric that we should highlight is BEN's P/B ratio of 1.42. The P/B ratio is used to compare a stock's market value with 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 2.84. Over the past 12 months, BEN's P/B has been as high as 1.60 and as low as 1.07, with a median of 1.32.
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. BEN has a P/S ratio of 2.03. This compares to its industry's average P/S of 3.23.
Finally, investors should note that BEN has a P/CF ratio of 7.34. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. BEN's P/CF compares to its industry's average P/CF of 14.75. BEN's P/CF has been as high as 14.11 and as low as 6.37, with a median of 10.48, all within the past year.
Victory Capital Holdings (VCTR - Free Report) may be another strong Financial - Investment Management stock to add to your shortlist. VCTR is a # 2 (Buy) stock with a Value grade of A.
Victory Capital Holdings is trading at a forward earnings multiple of 6.60 at the moment, with a PEG ratio of 0.74. This compares to its industry's average P/E of 13.86 and average PEG ratio of 1.02.
VCTR's Forward P/E has been as high as 8.63 and as low as 4.94, with a median of 6.47. During the same time period, its PEG ratio has been as high as 0.74, as low as 0.37, with a median of 0.67.
Furthermore, Victory Capital Holdings holds a P/B ratio of 2.72 and its industry's price-to-book ratio is 2.84. VCTR's P/B has been as high as 3.33, as low as 2.03, with a median of 2.64 over the past 12 months.
These are just a handful of the figures considered in Franklin Resources and Victory Capital Holdings'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 BEN and VCTR is an impressive value stock right now.
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Are These Finance Stocks 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.
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 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 stock to keep an eye on is Franklin Resources (BEN - Free Report) . BEN is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 9.27, while its industry has an average P/E of 13.86. Over the last 12 months, BEN's Forward P/E has been as high as 11.32 and as low as 8.27, with a median of 9.27.
BEN is also sporting a PEG ratio of 0.62. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. BEN's PEG compares to its industry's average PEG of 1.02. Over the past 52 weeks, BEN's PEG has been as high as 1.69 and as low as 0.62, with a median of 0.85.
Another valuation metric that we should highlight is BEN's P/B ratio of 1.42. The P/B ratio is used to compare a stock's market value with 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 2.84. Over the past 12 months, BEN's P/B has been as high as 1.60 and as low as 1.07, with a median of 1.32.
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. BEN has a P/S ratio of 2.03. This compares to its industry's average P/S of 3.23.
Finally, investors should note that BEN has a P/CF ratio of 7.34. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. BEN's P/CF compares to its industry's average P/CF of 14.75. BEN's P/CF has been as high as 14.11 and as low as 6.37, with a median of 10.48, all within the past year.
Victory Capital Holdings (VCTR - Free Report) may be another strong Financial - Investment Management stock to add to your shortlist. VCTR is a # 2 (Buy) stock with a Value grade of A.
Victory Capital Holdings is trading at a forward earnings multiple of 6.60 at the moment, with a PEG ratio of 0.74. This compares to its industry's average P/E of 13.86 and average PEG ratio of 1.02.
VCTR's Forward P/E has been as high as 8.63 and as low as 4.94, with a median of 6.47. During the same time period, its PEG ratio has been as high as 0.74, as low as 0.37, with a median of 0.67.
Furthermore, Victory Capital Holdings holds a P/B ratio of 2.72 and its industry's price-to-book ratio is 2.84. VCTR's P/B has been as high as 3.33, as low as 2.03, with a median of 2.64 over the past 12 months.
These are just a handful of the figures considered in Franklin Resources and Victory Capital Holdings'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 BEN and VCTR is an impressive value stock right now.