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Zacks Investment Ideas feature highlights: Copa Holdings, Bluegreen Vacations Holding and Crawford & Company
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For Immediate Release
Chicago, IL – June 14, 2023 – Today, Zacks Investment Ideas feature highlights Copa Holdings, S.A. (CPA - Free Report) , Bluegreen Vacations Holding Corporation and Crawford & Company CRD.
Value Stocks Are the Best, But How Can You Get into Them?
Most of us have heard a gazillion times the virtues of investing in undervalued stocks and holding them until they reach their true potential. This must have been one of the strategies investors have used ever since the creation of the stock markets. But it was Warren Buffet, drawing inspiration from Ben Graham that really put this strategy front and center. And since the proof of the pudding is in its eating, Buffet’s billions have “proved” the efficacy of this strategy.
So the big question is, how do we know that a stock is undervalued? And should this criterion be enough to warrant investing in a stock? You have to remember that some stocks have always traded at a low valuation with respect to its industry/peer group, as well as a broader benchmark index such as the S&P 500. Just because these stocks are trading at a low valuation does not therefore mean that we will suddenly find a trigger that will push up their share prices. Therefore, a brief discussion of share prices seems in order.
As it turns out, the more mature companies that are larger, with proven business models and lower risk generally don’t see big jumps in share prices. Even some major news about the company (unless it’s a merger or something equally existential) have relatively limited impact on share prices. However, over the course of several years, you find capital appreciation. Since the payback period is long, investors are generally willing to pay a lower premium for these stocks. On the other hand, investors are willing to pay a higher premium for stocks in companies with strong growth prospects because they expect a shorter payback period. That doesn’t mean that one kind of stock is better than the other. Nor does it mean that you should invest in just one kind of stock and not the other.
A properly balanced portfolio should have both value and growth stocks for their stability and capital appreciation, respectively. So whether you’re looking to add stability to your portfolio, or are simply risk averse, or you don’t have that many years of investing left, learning about value stocks and choosing wisely can help a lot.
The first step is to find stocks trading below their potential. This could be based on price-to-earnings (P/E), price-to-earnings growth (PEG), price-to-sales (P/S), price-to-book value (P/B), or any other standard valuation metric. However, P/E is the most commonly used.
It may also be a good idea to study its past performance and future prospects, simply because you don’t want to invest in a company you know nothing about. You should invest only if you’re convinced that the company isn’t going anywhere and is going to maintain its market position and competitive edge.
Consulting a few broker reports will greatly improve your understanding. Additionally, brokers usually provide a Buy, Sell or Hold rating on stocks and generally also provide a price target. You can calculate the difference between the current price and the target price to estimate if this kind of upside suits your personal investment goals.
To further sweeten things, try to choose companies that pay dividends because it never hurts to make money. It’s also a kind of risk mitigation, in case you made a wrong selection based on your risk appetite and investment horizon.
Today, I’ve selected a few stocks that brokers love. They belong to attractive industries, have attractive growth prospects and also pay dividends. To top it all, they carry a Zacks Rank #1 (Strong Buy) rating. The Zacks stock ranking system has proved highly effective historically, especially when the stocks belong to industries Zacks categorizes as attractive. So, let’s take a look see.
Copa Holdings, S.A.
Panama City, Panama-based Copa Holdings, S.A. provides airline passenger and cargo services. The company offers approximately 327 daily scheduled flights to 78 destinations in 32 countries in North, Central, and South America, as well as the Caribbean from its Panama City hub. As of December 31, 2022, it operated a fleet of 97 aircraft comprising 67 Boeing 737-800 Next Generation aircraft, 9 Boeing 737-700 Next Generation aircraft, 1 Boeing 737-800 Boeing Converted Freighter and 20 737-MAX aircraft.
The Zacks Rank #1 (Strong Buy) company belongs to the Transportation – Airline industry, placing it in the top 18% of industries classified by Zacks. Since any industry in the top 50% does better than the bottom 50%, this is one attractive industry. Therefore, the Strong Buy rating and industry rank alone increase your chances of success with this stock.
Add to that the fact that all of the brokers covering the stock also have a buy rating and the average rating of brokers is Strong Buy. They’ve also taken their estimates up 21.1% for 2023 and 18.1% for 2024.
Copa beat the Zacks Consensus Estimate by 19.5% in the last quarter and the average surprise versus estimates is 14.6% in the last four quarters.
Finally, the company pays a dividend that yields 2.93%, further adding to its attractiveness.
Valuation: The shares are trading at an 11.5% discount to the industry and a 60.2% discount to the S&P 500. Therefore, considering their recent performance and growth potential, they’re definitely worth picking up.
Bluegreen Vacations Holding Corporation
Boca Raton, Florida-based Bluegreen Vacations Holding Corporation is a vacation ownership company selling vacation ownership interests (VOI). The company manages resorts in leisure and urban destinations, such as Orlando, Las Vegas, Myrtle Beach, Charleston and New Orleans. It also provides resort management, mortgage, title, reservation, and construction design and development services; and financing to qualified VOI purchasers, as well as management services to the vacation club and homeowners' associations.
Bluegreen has a Zacks Rank #1, which is the same as the average broker rating on the stock. All of the brokers covering the stock recommend the shares.
The company belongs to the Leisure and Recreation Services industry (top 28%).
Both historical performance and estimate revisions for the future are attractive. In the last quarter, it beat estimates by 82.1%, with the four-quarter average at 24.7%. The 2023 estimate is up 11.8% in the last 60 days. The 2024 estimate is up 18.3%.
Bluegreen’s dividend yields 2.39%.
Valuation: The shares trade at 7.89X P/E, a significant discount to the industry’s 25.58X and the S&P 500’s 19.03X. Therefore, the shares are cheap and investors would benefit from buying them at these levels.
Crawford & Company
Headquartered in Atlanta, Georgia, Crawford & Company specializes in providing comprehensive claims management and outsourcing solutions to insurance companies, brokers, and corporations globally. Operating through four segments, namely North America Loss Adjusting, International Operations, Broadspire, and Platform Solutions, the company offers a wide range of services. These services include claims management for various insurance lines such as property, liability, automobile, and marine insurance. Crawford & Company also provides field investigation, evaluation, and resolution of property and casualty insurance claims, along with workers' compensation, accident & health, and disability claims management. Additionally, the company offers risk management information, consultative analytical services, medical management services, and insurance services for natural and man-made disasters. Crawford & Company's extensive reach spans across the United States, the United Kingdom, Europe, Canada, Australia, Asia, and Latin America.
Crawford belongs to the Business – Services industry (top 18%).
The Zacks Rank #1 stock is also a favorite with brokers and all of the analysts covering it are also in agreement about their Strong Buy rating.
This of course stems from its strong performance in the last two quarters, in which the reported earnings came in 35.3% and 75.0% higher that estimated. The four-quarter average is just 18.4%, possibly indicating some momentum in the business. Future estimates are trending up as a result. The 2023 estimate is up 29.9% while the 2024 estimate is up 23.4% in the last 60 days.
The company’s dividend yields 2.38%.
Valuation: The shares trade at a 57.2% discount to the industry and 56.2% discount to the S&P 500. Therefore, they’re going cheap.
Why Haven’t You Looked at Zacks' Top Stocks? Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Copa Holdings, Bluegreen Vacations Holding and Crawford & Company
For Immediate Release
Chicago, IL – June 14, 2023 – Today, Zacks Investment Ideas feature highlights Copa Holdings, S.A. (CPA - Free Report) , Bluegreen Vacations Holding Corporation and Crawford & Company CRD.
Value Stocks Are the Best, But How Can You Get into Them?
Most of us have heard a gazillion times the virtues of investing in undervalued stocks and holding them until they reach their true potential. This must have been one of the strategies investors have used ever since the creation of the stock markets. But it was Warren Buffet, drawing inspiration from Ben Graham that really put this strategy front and center. And since the proof of the pudding is in its eating, Buffet’s billions have “proved” the efficacy of this strategy.
So the big question is, how do we know that a stock is undervalued? And should this criterion be enough to warrant investing in a stock? You have to remember that some stocks have always traded at a low valuation with respect to its industry/peer group, as well as a broader benchmark index such as the S&P 500. Just because these stocks are trading at a low valuation does not therefore mean that we will suddenly find a trigger that will push up their share prices. Therefore, a brief discussion of share prices seems in order.
As it turns out, the more mature companies that are larger, with proven business models and lower risk generally don’t see big jumps in share prices. Even some major news about the company (unless it’s a merger or something equally existential) have relatively limited impact on share prices. However, over the course of several years, you find capital appreciation. Since the payback period is long, investors are generally willing to pay a lower premium for these stocks. On the other hand, investors are willing to pay a higher premium for stocks in companies with strong growth prospects because they expect a shorter payback period. That doesn’t mean that one kind of stock is better than the other. Nor does it mean that you should invest in just one kind of stock and not the other.
A properly balanced portfolio should have both value and growth stocks for their stability and capital appreciation, respectively. So whether you’re looking to add stability to your portfolio, or are simply risk averse, or you don’t have that many years of investing left, learning about value stocks and choosing wisely can help a lot.
The first step is to find stocks trading below their potential. This could be based on price-to-earnings (P/E), price-to-earnings growth (PEG), price-to-sales (P/S), price-to-book value (P/B), or any other standard valuation metric. However, P/E is the most commonly used.
It may also be a good idea to study its past performance and future prospects, simply because you don’t want to invest in a company you know nothing about. You should invest only if you’re convinced that the company isn’t going anywhere and is going to maintain its market position and competitive edge.
Consulting a few broker reports will greatly improve your understanding. Additionally, brokers usually provide a Buy, Sell or Hold rating on stocks and generally also provide a price target. You can calculate the difference between the current price and the target price to estimate if this kind of upside suits your personal investment goals.
To further sweeten things, try to choose companies that pay dividends because it never hurts to make money. It’s also a kind of risk mitigation, in case you made a wrong selection based on your risk appetite and investment horizon.
Today, I’ve selected a few stocks that brokers love. They belong to attractive industries, have attractive growth prospects and also pay dividends. To top it all, they carry a Zacks Rank #1 (Strong Buy) rating. The Zacks stock ranking system has proved highly effective historically, especially when the stocks belong to industries Zacks categorizes as attractive. So, let’s take a look see.
Copa Holdings, S.A.
Panama City, Panama-based Copa Holdings, S.A. provides airline passenger and cargo services. The company offers approximately 327 daily scheduled flights to 78 destinations in 32 countries in North, Central, and South America, as well as the Caribbean from its Panama City hub. As of December 31, 2022, it operated a fleet of 97 aircraft comprising 67 Boeing 737-800 Next Generation aircraft, 9 Boeing 737-700 Next Generation aircraft, 1 Boeing 737-800 Boeing Converted Freighter and 20 737-MAX aircraft.
The Zacks Rank #1 (Strong Buy) company belongs to the Transportation – Airline industry, placing it in the top 18% of industries classified by Zacks. Since any industry in the top 50% does better than the bottom 50%, this is one attractive industry. Therefore, the Strong Buy rating and industry rank alone increase your chances of success with this stock.
Add to that the fact that all of the brokers covering the stock also have a buy rating and the average rating of brokers is Strong Buy. They’ve also taken their estimates up 21.1% for 2023 and 18.1% for 2024.
Copa beat the Zacks Consensus Estimate by 19.5% in the last quarter and the average surprise versus estimates is 14.6% in the last four quarters.
Finally, the company pays a dividend that yields 2.93%, further adding to its attractiveness.
Valuation: The shares are trading at an 11.5% discount to the industry and a 60.2% discount to the S&P 500. Therefore, considering their recent performance and growth potential, they’re definitely worth picking up.
Bluegreen Vacations Holding Corporation
Boca Raton, Florida-based Bluegreen Vacations Holding Corporation is a vacation ownership company selling vacation ownership interests (VOI). The company manages resorts in leisure and urban destinations, such as Orlando, Las Vegas, Myrtle Beach, Charleston and New Orleans. It also provides resort management, mortgage, title, reservation, and construction design and development services; and financing to qualified VOI purchasers, as well as management services to the vacation club and homeowners' associations.
Bluegreen has a Zacks Rank #1, which is the same as the average broker rating on the stock. All of the brokers covering the stock recommend the shares.
The company belongs to the Leisure and Recreation Services industry (top 28%).
Both historical performance and estimate revisions for the future are attractive. In the last quarter, it beat estimates by 82.1%, with the four-quarter average at 24.7%. The 2023 estimate is up 11.8% in the last 60 days. The 2024 estimate is up 18.3%.
Bluegreen’s dividend yields 2.39%.
Valuation: The shares trade at 7.89X P/E, a significant discount to the industry’s 25.58X and the S&P 500’s 19.03X. Therefore, the shares are cheap and investors would benefit from buying them at these levels.
Crawford & Company
Headquartered in Atlanta, Georgia, Crawford & Company specializes in providing comprehensive claims management and outsourcing solutions to insurance companies, brokers, and corporations globally. Operating through four segments, namely North America Loss Adjusting, International Operations, Broadspire, and Platform Solutions, the company offers a wide range of services. These services include claims management for various insurance lines such as property, liability, automobile, and marine insurance. Crawford & Company also provides field investigation, evaluation, and resolution of property and casualty insurance claims, along with workers' compensation, accident & health, and disability claims management. Additionally, the company offers risk management information, consultative analytical services, medical management services, and insurance services for natural and man-made disasters. Crawford & Company's extensive reach spans across the United States, the United Kingdom, Europe, Canada, Australia, Asia, and Latin America.
Crawford belongs to the Business – Services industry (top 18%).
The Zacks Rank #1 stock is also a favorite with brokers and all of the analysts covering it are also in agreement about their Strong Buy rating.
This of course stems from its strong performance in the last two quarters, in which the reported earnings came in 35.3% and 75.0% higher that estimated. The four-quarter average is just 18.4%, possibly indicating some momentum in the business. Future estimates are trending up as a result. The 2023 estimate is up 29.9% while the 2024 estimate is up 23.4% in the last 60 days.
The company’s dividend yields 2.38%.
Valuation: The shares trade at a 57.2% discount to the industry and 56.2% discount to the S&P 500. Therefore, they’re going cheap.
Why Haven’t You Looked at Zacks' Top Stocks? Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.