Back to top

Image: Bigstock

Is Isabella Bank (ISBA) Stock Undervalued Right Now?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

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 a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Isabella Bank (ISBA - Free Report) . ISBA is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with P/E ratio of 7.47 right now. For comparison, its industry sports an average P/E of 9.04. Over the last 12 months, ISBA's Forward P/E has been as high as 13.56 and as low as 6.40, with a median of 7.51.

Investors should also recognize that ISBA has a P/B ratio of 1.02. Investors use the P/B ratio to look at a stock's market value versus 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 1.54. Within the past 52 weeks, ISBA's P/B has been as high as 1.05 and as low as 0.86, with a median of 0.94.

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. ISBA has a P/S ratio of 2.28. This compares to its industry's average P/S of 2.58.

Finally, investors will want to recognize that ISBA has a P/CF ratio of 6.78. 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. ISBA's current P/CF looks attractive when compared to its industry's average P/CF of 13.06. Over the past year, ISBA's P/CF has been as high as 8.36 and as low as 6.32, with a median of 7.25.

These are just a handful of the figures considered in Isabella Bank's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ISBA is an impressive value stock right now.


See More Zacks Research for These Tickers


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


Isabella Bank Corporation (ISBA) - free report >>

Published in