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Are These Business Services Stocks a Great Value Stocks Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

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.

One stock to keep an eye on is BGSF (BGSF - Free Report) . BGSF is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 11.41. This compares to its industry's average Forward P/E of 25.42. Over the past year, BGSF's Forward P/E has been as high as 14.74 and as low as 9.93, with a median of 11.18.

Investors will also notice that BGSF has a PEG ratio of 0.57. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. BGSF's industry has an average PEG of 0.66 right now. Over the past 52 weeks, BGSF's PEG has been as high as 0.74 and as low as 0.50, with a median of 0.56.

We should also highlight that BGSF has a P/B ratio of 2.05. 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 4.37. Over the past year, BGSF's P/B has been as high as 2.33 and as low as 1.72, with a median of 1.97.

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. BGSF has a P/S ratio of 0.5. This compares to its industry's average P/S of 1.49.

Finally, we should also recognize that BGSF has a P/CF ratio of 9.94. 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 21.87. Within the past 12 months, BGSF's P/CF has been as high as 26.48 and as low as 8.37, with a median of 10.47.

Another great Business - Services stock you could consider is Avis Budget Group (CAR - Free Report) , which is a # 1 (Strong Buy) stock with a Value Score of A.

Avis Budget Group is currently trading with a Forward P/E ratio of 11.25 while its PEG ratio sits at 0.60. Both of the company's metrics compare favorably to its industry's average P/E of 25.42 and average PEG ratio of 0.66.

CAR's price-to-earnings ratio has been as high as 185.44 and as low as -790.64, with a median of 17.30, while its PEG ratio has been as high as 11.83 and as low as 0.16, with a median of 0.57, all within the past year.

Avis Budget Group sports a P/B ratio of -64.25 as well; this compares to its industry's price-to-book ratio of 4.37. In the past 52 weeks, CAR's P/B has been as high as 86.95, as low as -101.83, with a median of -18.89.

Value investors will likely look at more than just these metrics, but the above data helps show that BGSF and Avis Budget Group are likely undervalued currently. And when considering the strength of its earnings outlook, BGSF and CAR sticks out as one of the market's strongest value stocks.


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