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Is Green Dot (GDOT) Stock Undervalued Right Now?

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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 use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

Green Dot (GDOT - Free Report) is a stock many investors are watching right now. GDOT is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 11.15. This compares to its industry's average Forward P/E of 22.74. Over the last 12 months, GDOT's Forward P/E has been as high as 21.53 and as low as 9.56, with a median of 13.78.

Finally, investors will want to recognize that GDOT has a P/CF ratio of 10.96. 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. GDOT's P/CF compares to its industry's average P/CF of 17.72. Within the past 12 months, GDOT's P/CF has been as high as 30.62 and as low as 9.22, with a median of 16.26.

Paysafe Limited (PSFE - Free Report) may be another strong Financial Transaction Services stock to add to your shortlist. PSFE is a # 2 (Buy) stock with a Value grade of A.

Paysafe Limited sports a P/B ratio of 1.31 as well; this compares to its industry's price-to-book ratio of 5.77. In the past 52 weeks, PSFE's P/B has been as high as 1.64, as low as 0.24, with a median of 0.75.

These are only a few of the key metrics included in Green Dot and Paysafe Limited strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, GDOT and PSFE look like an impressive value stock at the moment.


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