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Should Value Investors Buy Wabash National (WNC) Stock?
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.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. 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 company to watch right now is Wabash National (WNC - Free Report) . WNC is currently holding a Zacks Rank of #1 (Strong Buy) and a Value grade of A. The stock has a Forward P/E ratio of 10.17. This compares to its industry's average Forward P/E of 22.30. Over the last 12 months, WNC's Forward P/E has been as high as 11.48 and as low as 5.85, with a median of 7.82.
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. WNC has a P/S ratio of 0.54. This compares to its industry's average P/S of 0.81.
Value investors will likely look at more than just these metrics, but the above data helps show that Wabash National is likely undervalued currently. And when considering the strength of its earnings outlook, WNC sticks out at as one of the market's strongest value stocks.