Back to top

Image: Bigstock

Are Investors Undervaluing CF Bankshares (CFBK) Right Now?

Read MoreHide Full Article

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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is CF Bankshares (CFBK - Free Report) . CFBK 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 7.41, which compares to its industry's average of 8.13. Over the past year, CFBK's Forward P/E has been as high as 10.97 and as low as 6.15, with a median of 7.27.

Another notable valuation metric for CFBK is its P/B ratio of 0.88. The P/B ratio pits a stock's market value against 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 1.45. Over the past year, CFBK's P/B has been as high as 1 and as low as 0.81, with a median of 0.87.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. CFBK has a P/S ratio of 1.96. This compares to its industry's average P/S of 2.76.

Finally, investors should note that CFBK has a P/CF ratio of 8.49. 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. CFBK's P/CF compares to its industry's average P/CF of 14.66. Over the past 52 weeks, CFBK's P/CF has been as high as 9.75 and as low as 6.80, with a median of 8.18.

Value investors will likely look at more than just these metrics, but the above data helps show that CF Bankshares is likely undervalued currently. And when considering the strength of its earnings outlook, CFBK sticks out at as one of the market's strongest value stocks.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


CF Bankshares Inc. (CFBK) - free report >>

Published in