Back to top

Image: Bigstock

Should Value Investors Buy Huron Consulting Group (HURN) Stock?

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.

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.

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.

One company value investors might notice is Huron Consulting Group (HURN - Free Report) . HURN is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 18.30 right now. For comparison, its industry sports an average P/E of 22.22. Over the past 52 weeks, HURN's Forward P/E has been as high as 20.37 and as low as 13.95, with a median of 17.63.

Another valuation metric that we should highlight is HURN's P/B ratio of 2.59. The P/B is a method of comparing a stock's market value to 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 5.52. Over the past year, HURN's P/B has been as high as 2.83 and as low as 1.66, with a median of 2.24.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. HURN has a P/S ratio of 1.32. This compares to its industry's average P/S of 1.87.

Finally, our model also underscores that HURN has a P/CF ratio of 12.68. 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. HURN's P/CF compares to its industry's average P/CF of 14.27. Over the past year, HURN's P/CF has been as high as 20.24 and as low as 8.70, with a median of 11.83.

Investors could also keep in mind Information Services Group (III - Free Report) , an Consulting Services stock with a Zacks Rank of # 2 (Buy) and Value grade of A.

Information Services Group is trading at a forward earnings multiple of 9.97 at the moment, with a PEG ratio of 0.59. This compares to its industry's average P/E of 22.22 and average PEG ratio of 2.05.


See More Zacks Research for These Tickers


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


Huron Consulting Group Inc. (HURN) - free report >>

Information Services Group, Inc. (III) - free report >>

Published in