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Should Value Investors Buy Abercrombie & Fitch (ANF) Stock?

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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.

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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One stock to keep an eye on is Abercrombie & Fitch (ANF - Free Report) . ANF is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 11.76, which compares to its industry's average of 13.80. Over the last 12 months, ANF's Forward P/E has been as high as 121.44 and as low as 11.21, with a median of 16.89.

Finally, our model also underscores that ANF has a P/CF ratio of 10.73. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 12.31. ANF's P/CF has been as high as 12.09 and as low as 3.53, with a median of 8.95, all within the past year.

If you're looking for another solid Retail - Apparel and Shoes value stock, take a look at Urban Outfitters (URBN - Free Report) . URBN is a # 1 (Strong Buy) stock with a Value score of A.

Urban Outfitters is currently trading with a Forward P/E ratio of 9.48 while its PEG ratio sits at 0.40. Both of the company's metrics compare favorably to its industry's average P/E of 13.80 and average PEG ratio of 0.83.


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