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Are Investors Undervaluing These Business Services 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.

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.

KornFerry International (KFY - Free Report) is a stock many investors are watching right now. KFY is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 11.06, which compares to its industry's average of 12.34. KFY's Forward P/E has been as high as 29.60 and as low as 10.46, with a median of 15.78, all within the past year.

We should also highlight that KFY has a P/B ratio of 2.28. 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 company's current P/B looks solid when compared to its industry's average P/B of 3.02. Over the past 12 months, KFY's P/B has been as high as 3.06 and as low as 2.16, with a median of 2.68.

Finally, we should also recognize that KFY has a P/CF ratio of 9.44. 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. KFY's P/CF compares to its industry's average P/CF of 11.12. KFY's P/CF has been as high as 33.47 and as low as 8.95, with a median of 13.55, all within the past year.

Randstad Holding (RANJY - Free Report) may be another strong Staffing Firms stock to add to your shortlist. RANJY is a # 1 (Strong Buy) stock with a Value grade of A.

Randstad Holding sports a P/B ratio of 2.03 as well; this compares to its industry's price-to-book ratio of 3.02. In the past 52 weeks, RANJY's P/B has been as high as 2.86, as low as 1.75, with a median of 2.43.

These are just a handful of the figures considered in KornFerry International and Randstad Holding'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 KFY and RANJY is an impressive value stock right now.


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Korn/Ferry International (KFY) - free report >>

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