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Is Pathward Financial Inc. (CASH) Stock Undervalued 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.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

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.

Pathward Financial Inc. (CASH - Free Report) is a stock many investors are watching right now. CASH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock holds a P/E ratio of 7.81, while its industry has an average P/E of 9.46. CASH's Forward P/E has been as high as 13.36 and as low as 5.71, with a median of 7.82, all within the past year.

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. CASH has a P/S ratio of 2. This compares to its industry's average P/S of 2.59.

Finally, we should also recognize that CASH has a P/CF ratio of 5.50. 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. CASH's P/CF compares to its industry's average P/CF of 8.98. Within the past 12 months, CASH's P/CF has been as high as 10.32 and as low as 4.31, with a median of 5.85.

Flagstar Bancorp may be another strong Financial - Savings and Loan stock to add to your shortlist. FBC is a # 2 (Buy) stock with a Value grade of A.

Additionally, Flagstar Bancorp has a P/B ratio of 0.79 while its industry's price-to-book ratio sits at 0.95. For FBC, this valuation metric has been as high as 1.01, as low as 0.63, with a median of 0.80 over the past year.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Pathward Financial Inc. and Flagstar Bancorp are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, CASH and FBC feels like a great value stock at the moment.


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