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Are Investors Undervaluing H&E Equipment Services (HEES) 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 tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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 H&E Equipment Services (HEES - Free Report) . HEES is currently sporting a Zacks Rank of #1 (Strong Buy) and an A for Value. The stock holds a P/E ratio of 11.60, while its industry has an average P/E of 15.65. Over the past 52 weeks, HEES's Forward P/E has been as high as 30.43 and as low as 8.27, with a median of 11.28.

We should also highlight that HEES has a P/B ratio of 4.35. The P/B ratio is used to compare a stock's market value with 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 6.38. HEES's P/B has been as high as 6.41 and as low as 2.88, with a median of 4.15, over the past year.

Finally, investors will want to recognize that HEES has a P/CF ratio of 3.77. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. HEES's current P/CF looks attractive when compared to its industry's average P/CF of 11.37. Within the past 12 months, HEES's P/CF has been as high as 5.64 and as low as 2.44, with a median of 3.46.

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


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