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Should Value Investors Buy These Retail-Wholesale Stocks?
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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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 company value investors might notice is The Kroger Co. (KR - Free Report) . KR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 14.14. This compares to its industry's average Forward P/E of 20.13. KR's Forward P/E has been as high as 15.17 and as low as 9.88, with a median of 12.90, all within the past year.
Investors will also notice that KR has a PEG ratio of 1.69. 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. KR's industry currently sports an average PEG of 2.54. Within the past year, KR's PEG has been as high as 2.26 and as low as 1.32, with a median of 1.71.
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. KR has a P/S ratio of 0.26. This compares to its industry's average P/S of 0.28.
Finally, investors will want to recognize that KR has a P/CF ratio of 8.18. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.28. KR's P/CF has been as high as 8.33 and as low as 3.77, with a median of 6.15, all within the past year.
Investors could also keep in mind Tesco (TSCDY - Free Report) , an Retail - Supermarkets stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Shares of Tesco currently holds a Forward P/E ratio of 12.87, and its PEG ratio is 0.39. In comparison, its industry sports average P/E and PEG ratios of 20.13 and 2.54.
TSCDY's Forward P/E has been as high as 18.18 and as low as 9.73, with a median of 12.41. During the same time period, its PEG ratio has been as high as 2.94, as low as 0.39, with a median of 0.49.
Tesco sports a P/B ratio of 1.67 as well; this compares to its industry's price-to-book ratio of 3.80. In the past 52 weeks, TSCDY's P/B has been as high as 1.97, as low as 1.43, with a median of 1.57.
These are just a handful of the figures considered in The Kroger Co. and Tesco'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 KR and TSCDY is an impressive value stock right now.
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Should Value Investors Buy These Retail-Wholesale Stocks?
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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 company value investors might notice is The Kroger Co. (KR - Free Report) . KR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 14.14. This compares to its industry's average Forward P/E of 20.13. KR's Forward P/E has been as high as 15.17 and as low as 9.88, with a median of 12.90, all within the past year.
Investors will also notice that KR has a PEG ratio of 1.69. 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. KR's industry currently sports an average PEG of 2.54. Within the past year, KR's PEG has been as high as 2.26 and as low as 1.32, with a median of 1.71.
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. KR has a P/S ratio of 0.26. This compares to its industry's average P/S of 0.28.
Finally, investors will want to recognize that KR has a P/CF ratio of 8.18. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 13.28. KR's P/CF has been as high as 8.33 and as low as 3.77, with a median of 6.15, all within the past year.
Investors could also keep in mind Tesco (TSCDY - Free Report) , an Retail - Supermarkets stock with a Zacks Rank of # 1 (Strong Buy) and Value grade of A.
Shares of Tesco currently holds a Forward P/E ratio of 12.87, and its PEG ratio is 0.39. In comparison, its industry sports average P/E and PEG ratios of 20.13 and 2.54.
TSCDY's Forward P/E has been as high as 18.18 and as low as 9.73, with a median of 12.41. During the same time period, its PEG ratio has been as high as 2.94, as low as 0.39, with a median of 0.49.
Tesco sports a P/B ratio of 1.67 as well; this compares to its industry's price-to-book ratio of 3.80. In the past 52 weeks, TSCDY's P/B has been as high as 1.97, as low as 1.43, with a median of 1.57.
These are just a handful of the figures considered in The Kroger Co. and Tesco'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 KR and TSCDY is an impressive value stock right now.