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Should Value Investors Buy ADEIA INC (ADEA) Stock?
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.
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 rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
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.
ADEIA INC (ADEA - Free Report) is a stock many investors are watching right now. ADEA is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A.
Investors should also recognize that ADEA has a P/B ratio of 2.82. The P/B ratio pits a stock's market value against 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 5.70. Over the past 12 months, ADEA's P/B has been as high as 3.95 and as low as 0.77, with a median of 1.23.
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 prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. ADEA has a P/S ratio of 1.05. This compares to its industry's average P/S of 1.7.
Another great Technology Services stock you could consider is Vontier (VNT - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
Shares of Vontier are currently trading at a forward earnings multiple of 8.87 and a PEG ratio of 3.12 compared to its industry's P/E and PEG ratios of 58.43 and 3.40, respectively.